Market Overview – Morning Express
|Do not miss our daily Midday Market Minute, digesting yesterday’s closing levels.|
|Bill Baruch, CIO of Blue Line Capital, and analyst Jannis Meindl dive into cybersecurity stocks.|
* Apple introduced the Vision Pro mixed reality headset as the stock was making a new all-time high at 184.95 and surpassing the 181.36 achieved on January 4, 2022. The headset’s price tag of $3,499 shocked many, leading to a swift reversal in the stock price before settling at 179.58 and not achieving a record close. Price action was peeling off a bit before the cost announcement. We believe it is easy to criticize new technologies, especially as a potential recession clouds one’s opinion, but we certainly do not want to underestimate its potential. Most importantly, Vision Pro revenues are not baked into Apple’s current estimates, therefore we see no immediate headwind.
* The Reserve Bank of Australia surprised with a 25bps rate hike overnight, bringing rates to 4.1% an 11-year high, and citing stubbornly high inflation with CPI at 6.8% y/y.
* Crude reverses and surrenders rare major four-star support at $72 in ‘buy the rumor, sell the news’ jawboning. Although Saudi Arabia pledged to cut an additional 1 mbpd beginning in July and OPEC+ promised to run additional cuts through 2023, the cartels frontrunning exuded fears of global growth. Waves of selling penetrated early strength after U.S. Services data disappointed.
* Markets remain emotional, “the economy is great” following Friday’s Nonfarm Payroll, “the economy is falling apart” after yesterday’s ISM Non-Manufacturing (Services).
* ISM Non-Manufacturing headline still expanded at 50.3, though some believe that line of expansion/contraction is more like 52/53 in this distorted environment. Prices expanded though at slowest since April 2020, and Orders expanded though much slower than expected at 52.9 versus 56.5. All things considered, this is the exact type of report markets should have celebrated as it should keep the Federal Reserve from being aggressive.
* Commodity traders must keep an eye on CNH futures which have rise to a session to hit a new cycle high at 7.128, the highest since November. This is USDCNH, strength highlights U.S. Dollar strength and Yuan weakness. A weaker Yuan and stronger Dollar is a direct headwind to commodities and typically risk-assets in general.
* According to the CME FedWatch Tool, there is currently at 24.1% probability the Fed hikes by 25bps at its June 14th
E-mini S&P (June) / NQ (June)
S&P, yesterday’s close: Settled at 4281.00, down 7.00
NQ, yesterday’s close: Settled at 14,588.75, up 13.50
E-mini S&P and E-mini NQ futures each set new cycle highs through the first half of yesterday’s session before retreating into the close. Friday’s opening bell range helps define our first levels of support, highlighted in the levels below, and we believe a constructive response to these pockets through today will help underpin renewed strength. Furthermore, steady price action above our Pivot and point of balance will help pave such a favorable response. At the end of the day, the trend is bullish and a healthy consolidation should resolve in the direction of the underlying trend. A move out above first key resistance in the E-mini S&P and E-mini NQ at … Click here to get our (FULL) daily reports emailed to you!
Crude Oil (July)
Yesterday’s close: Settled at 72.15, up 0.41
Crude Oil futures have surrendered any potential constructive response to last week’s late strength and Sunday’s strong open, therefore we have Neutralized our cautiously Bullish Bias and away further clarity. The EIA will release its Short-Term Energy Outlook at 11:00 am CT and expectations for tomorrow’s weekly EIA report will hit the tape as the day unfolds. Previous support is now resistance, aligning Friday’s settlement with retracements and volume at 71.74-72.25 and Crude Oil must settle above here in order to reinvigorate bullish enthusiasm in the near-term. To the downside, we have major three-star support at … Click here to get our (FULL) daily reports emailed to you!
Gold (August) / Silver (July)
Gold, yesterday’s close: Settled at 1978.7, up 4.4
Silver, yesterday’s close: Settled at 23.635, down 0.112
Gold and Silver futures were working higher early yesterday and received bullish tailwinds from weaker than expected ISM Non-Manufacturing data, which helps set the stage into next week’s Fed meeting. Remember, our narrative has and will always be the Fed cannot telegraph a pivot, pause, skip, whatever you want to call it, until the exact moment they are ready, due to the market’s reaction function. Given the current landscape, we believe the stage is being set for a skip or pause, and this factors into our cautiously Bullish Bias. From a technical standpoint, Gold’s constructive session yesterday is now testing the repair zone and both Gold and Silver have major three-star resistance at… Click here to get our (FULL) daily reports emailed to you!
Follow us on Twitter: @BlueLineFutures
Follow us on Facebook: Blue Line Futures Facebook page
Subscribe to our YouTube channel: Blue Line Futures YouTube channel
If you have any questions about markets, trading, or opening an account, please let us know!
You can email us at info@BlueLineFutures.com or call 312-278-0500
Futures trading involves a substantial risk of loss and may not be suitable for all investors. Trading advice is based on information taken from trade and statistical services and other sources Blue Line Futures, LLC believes are reliable. We do not guarantee that such information is accurate or complete, and it should not be relied upon as such. Trading advice reflects our good faith judgment at a specific time and is subject to change without notice. There is no guarantee that the advice we give will result in profitable trades. All trading decisions will be made by the account holder. Past performance is not necessarily indicative of future results.