Market Overview – Morning Express
– Our weekly Top Three Things to Watch this Week. Posted on Sundays.
– Trade Balance data from China over the weekend showed strong global demand with Exports topping expectations at +27.1% YoY versus +22.7%. Imports missed at +20.6% versus 26.6%. Crude Oil imports fell to a more than 3-year low at 8.94 mbpd
– House passed $1 trillion infrastructure bill Friday night. Senate had already stamped the bill that adds $550 billion in new public works spending.
– House voted Saturday to begin debating $1.75 trillion social spending package. Democrats are still divided.
– Federal Reserve back in the spotlight, deluge of speak. Chair Powell is the highlight at 9:30 am CT. Followed by Fed Governor Clarida at 8:00 am CT, NY Fed President Williams at 9:55 am CT, Fed Governor Bowman at 11:00 am CT, permanent voting seats, and Chicago Fed President Evans at 12:50 pm CT, a 2021 voter.
– U.S. Treasury auctions $56 billion 3-years at noon CT today, $39 billion 10-years tomorrow, and $25 billion 30-years Wednesday.
– Inflation is front and center through midweek, U.S. PPI tomorrow and CPI Wednesday.
– Keep an eye on Covid cases. Germany added at a slower pace over the weekend. Does that stick? China still adding cases at a slow pace. Do draconian measures slow growth?
– Tesla lost as much as 6% after Elon Musk tweeted a poll to decide whether to sell 10% of his stake in the company.
– PayPal, Roblox, and AMC report after the bell today.
– Do not miss our daily Midday Market Minute, recapping jobs on Friday.
E-mini S&P (December) / NQ (December)
S&P, yesterday’s close: Settled at 4690.25, up 17.00
NQ, yesterday’s close: Settled at 16,351.75, up 21.00
– Per our discussion last week, the market has embarked on its next leg. This is a melt-up and resistance levels matter less, it is more about defining a floor.
– Friday’s high did hit our next key resistance level perfectly at 4712.
– Higher floor developing in the S&P at 4650.75-4654.50.
– Higher floor developing in the NQ at 16,143-16,157.
– Still, have major three-star supports higher than developing floor, detailed below.
– Friday’s midday swing lower was met exactly at the .382 fib retracement from high on session to post-Fed hour low in both the S&P and NQ.
– We are outright Bullish in Bias while the S&P and NQ hold above … Sign up for a Free Trial at Blue Line Futures to have our entire fundamental and technical outlook, actionable bias, and proprietary levels for the markets you trade emailed each morning.
Crude Oil (December)
Yesterday’s close: Settled at 81.27, up 2.46
– Bullish tailwinds from policy in Washington hampering U.S. pipelines and OPEC+ rejecting to bring production back at a faster pace.
– Saudi Arabia raised the price of its Crude to Asia.
– Headwinds from China. Strong Export data showing global growth. However, Imports of Crude fell to a more than 3-year low.
– We spoke of a settlement back above 80.77-81.17 as neutralizing last week’s plunge. Has turned into more of a whiplash but must remain constructive above this level.
– We are now more Bullish in Bias and are buyers while holding constructively above … Sign up for a Free Trial at Blue Line Futures to have our entire fundamental and technical outlook, actionable bias, and proprietary levels for the markets you trade emailed each morning.
Gold (December) / Silver (December)
Gold, yesterday’s close: Settled at 1816.8, up 23.3
Silver, yesterday’s close: Settled at 24.157, up 0.246
– Goldilocks jobs reports, per our description in the Midday Market Minute. Jobs did show up but not massive growth. More importantly for the bullish metals thesis, Wage Growth was in line and did not surge.
– U.S Dollar Index off by 0.5%, helping to underpin commodities
– Treasury complex stable, although off the highs, after last week’s rip in Bonds.
– Bond yields have failed massively from trend line resistance. We have been talking about this for a month. Treasury auctions in the mix this week. Chart above.
– Be on the look out for Jekyll and Hyde from Fed speak. After ultra-dovish and basically net-zero taper, do they play the other side of that?
– Gold has broken out above trend line resistance, but as we have spoken of, it will not be out of the woods until a close above 1836. Previous resistance is now support, held overnight.
– Silver out above resistance and faces next major headwinds at … Sign up for a Free Trial at Blue Line Futures to have our entire fundamental and technical outlook, actionable bias, and proprietary levels for the markets you trade emailed each morning.
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