Market Overview – Morning Express
E-mini S&P (September) / NQ (September)
S&P, yesterday’s close: Settled at 4418.75, up 48.50
NQ, last week’s close: Settled at 15,111.50, up 255.00
The bullish seasonal trade for the E-mini S&P started out with a bang, gaining 1.1% on day one. If you buy the S&P on June 27th and hold it through July 23rd it has been profitable 15 out of the last 15 years, averaging 73 points. However, cold water was thrown over the market’s leadership after the bell when the White House said it is considering new restrictions on exports of AI chips to China. NVDA is down more than 3% ahead of the bell, but for now off the worst levels of the session. Although semis have been leaders throughout the year, we have been discussing a broadening of leadership where specialty industrials are beginning to show up. For instance, MTZ, an infrastructure company, is +15% month to date and closed yesterday at two-year highs, ROK, an industrial automation company, is also +15% month to date and closed at 18-month highs, and WAB, a technology-based company in locomotive industry is +14% month to date. All three are owned in portfolios at our investment advisor arm Blue Line Capital. The point is, although we are not ignoring the headwinds, there are many positives within this market, you need to find them.
On a technical basis, each of the E-mini S&P and E-mini NQ held the 21-day moving average, signaling that bullish momentum is still intact. There is strong major three-star resistance in the E-mini S&P at 4418.75-4423.75, aligning settlements from yesterday and last Thursday, but we also have key resistance just above at 4427-4430.75. Yesterday, the E-mini NQ did not even clear Monday’s opening bell range high, and this pocket poses major three-star resistance at 15,111-15,155. Price action must clear these levels on a closing basis in order to begin repairing the damage up to 4453.75-4455.50 in the E-mini S&P. To the downside, we have three waves of major three-star support in the E-mini S&P detailed in the levels below, and a pullback from yesterday’s rally would be most constructive, holding the highest at 4389-4391.
Resistance: 4418.75-4423.75***, 4427-4430.75**, 4441.50-4444.75**, 4453.75-4455.50***
Support: 4401.25-4403**, 4389-4391***, 4379.25-4381***, 4370.25-4374.25***, 4266.50**, 4342.75-4348.75****, 4317-4327.50***
Resistance: 15,111-15,155***, 15,214-15,217**, 15,268-15,310***
Support: 14,963-14,986***, 14,888-14,898**, 14,856***, 14,735***, 14,503-14,508***
Crude Oil (August)
Yesterday’s close: Settled at 67.70, down 1.67
Crude Oil futures, along with most commodities, continue to struggle to hold any rally attempts. Inventory data will be front and center this morning at 9:30 am CT. Expectations are for -1.757 mb Crude, -0.126 mb Gasoline, and +0.782 mb Distillates. On last night’s private API survey, Crude was -2.4 mb, Gasoline -2.85 mb, and Distillates +0.777 mb. Like many economic indicators, the EIA data in recent weeks has been wonky. Remember to keep a pulse on SPR and Net Imports when diving into the headline reads. This morning’s weakness is testing into major three-star support at 66.96-67.29. If it can hold through the report, we imagine a path of least resistance higher could be created.
Resistance: 68.45-68.53**, 69.16-69.37**, 70.03-70.33***
Support: 66.96-67.29***, 65.00**
Gold (August) / Silver (September)
Gold, yesterday’s close: Settled at 1923.8, down 10.0
Silver, yesterday’s close: Settled at 23.148, up 0.124
Gold and Silver futures are lower this morning. What is new? Although rates have peeled off slightly, the U.S. Dollar is broadly charging against foreign currencies, bringing a direct hit to the metals complex. Gold is now trading at the lowest level since March 13th, and after making a charge that tested its record high, we must see prices hold major three-star support at 1906.2-1911.6, a pocket aligning with the 2011 high. Surrendering the psychological $1900 mark would be an extensive blow to Gold’s bullish cause. As for Silver, it is battling to hold a critical area of support at 22.82-22.91, aligning with Friday’s spike, after failing at major three-star resistance at 23.29.
Resistance: 1943-1944.9**, 1949-1950.5***, 1960.1-1962.6***
Support: 1929.6-1931.5**, 1919.5-1923.7**, 1906.2-1911.6***
Resistance: 23.29***, 23.43-23.49***
Support: 22.82-22.91***, 22.54***, 22.05-22.40****
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