Market Overview – Morning Express

3 years ago 806 views 4 min read

Bill Baruch

President and Founder

Blue Line Futures

– We have been highlighting rising Covid cases across Europe. Risk-assets turned sharply lower early this morning after Austria announced a full lockdown and Germany’s health minister wouldn’t rule it out. Germany is the union’s largest economy. Cases rose by a record 68k on Wednesday and the 7-day moving average at 45k matches the previous single day record from back in January.

– Euro trading below 1.13 and Dollar Index above 96, for the first time since July 2020 (outside of spike Tuesday night). Euro Stoxx -1% and DAX -0.6%

– House is expected to vote today on President Biden’s $2 trillion social spending bill.

– 30-year Bond futures rip to highest since Friday on lockdown news. Yield back to critical 1.90% and unchanged on the week after rallying to a high of 2.048%.

– Comments from Fed Governor Waller at 9:45 am CT and Fed Vice-Chair Clarida due at 11:15 am. Come after more hawkish comments from permanent voting NY Fed President Williams yesterday.

– Probability of a Fed hike by June still at 53.3%.

– Fresh record highs overnight in the S&P and NQ. However, S&P has retreated almost 1% from high of 4723.

– Energy, Materials and Financials will be the hardest hit sectors as lockdown stocks and Tech take the lead.

– Cyclical heavy Russell 2000 down 3.3% on the week and back-testing trend line. Shown in chart above.

E-mini S&P (December) / NQ (December)

NQ, yesterday’s close: Settled at 16,481.25, up 169.75

– Tech continues to lead higher, as we have been discussing. NQ never turned red after lockdown news. New floor developing at 16,392-16,449?

– With S&P reversal from fresh record, technical landscape very similar to yesterday with Pivot and point of balance at 4692.50.

– Momentum indicator is now overhead and aligning at 4701-4705; a decisive move back above here on the session would likely have legs.

– Strong first key support at 4684.75-4685.50; price action responding to this so far.

– Bulls in the driver’s seat across all timeframes until break below major three-star support at … Click here to get our (FULL) daily reports emailed to you!

Yesterday’s close: Settled at 78.41, up 0.86

– We have been extremely cautious the energy sector of late, explicitly detailing headwinds from rising Covid cases and the White House. Furthering that positioning with patience into rare major four-star support at 74.96-75.12 should prove to be a great long-term buy.

– We have maintained a more Bullish Bias due to the strength of the uptrend and our longer-term upside expectations.

– Rally from yesterday failed perfectly at major three-star resistance at Click here to get our (FULL) daily reports emailed to you!