– Global equity markets mixed to flat, but U.S. equity benchmarks extend gains led by Tech. Fresh record highs in the NQ for the third straight session.
– S&P had a soft finish from highs Friday after hawkish comments from Fed Vice-Chair Clarida; taper timeline can be reevaluated at the December meeting.
– People’s Bank of China left rates unchanged but dropped hawkish verbiage from statement, alluding to willingness to stimulate if needed. PBOC has been adamant about controlling inflation.
– Austria enters full lockdown. Violent protests breakout across Europe against Covid lockdowns.
– Risk-assets had moved lower early Friday on Europe lockdown fears, but German Foreign Minister said full/broad lockdown unlikely and losses were quickly pared.
– We have been highlighting case counts in Germany for weeks, this will be ever important. Rise in cases subdued over the weekend, typical though.
– White House is throttling out SPR, asking Asian nations to join. Japan indicated willingness to follow.
– Chicago Fed National Activity due at 7:30 am CT and Existing Home Sales follow at 9:00 am CT.
– Europe and U.S. Flash PMIs tomorrow, as well as 7-year Note auction.
E-mini S&P (December) / NQ (December)
S&P, yesterday’s close: Settled at 4694.50, down 7.00 on Friday and up 16.25 on the week
NQ, yesterday’s close: Settled at 16,575, up 93.75 on Friday and 382.25 on thew week
– S&P and NQ working to define higher floors. The S&P solidified 4667-4669 last week on two tests. Recurring level 4684.75-4685.50 would be next in line. The NQ is detailed with rare major four-star support in the levels below.
– Price action in the S&P holding steadily above 4701-4705, previous resistance, now aligns with momentum indicator as our Pivot and point of balance.
– Higher price action overnight in the S&P struggled through the open last week, but stabilized to finish well.
– Week 3 option expiration in the rearview mirror, and no bats of true volatility given elevation. Remember 50 points in the S&P is now 1%! However, weakness now may find less footing from dealers defense.
– S&P currently playing out a rising triangle pattern (chart above), typically resolves higher and the direction of the underlying trend. However, rising triangles that drag out can become rising wedges. These have a higher probability of resulting in a reversal. Key takeaway; the sooner the resolution, the more likely it is a bullish one…. Click here to get our (FULL) daily reports emailed to you!
Crude Oil (January)
Yesterday’s close: Settled at 75.94, down 2.47 on Friday and 3.75 on the week
– China alluding to liquidity support helped underpin and overnight rally from rare major four-star support but stalled at first key resistance at 76.67-76.98 perfectly.
– Expect SPR discussion to evolve. We have said and maintain, we view extensive action as capitulatory, resulting in a more intermediate-term bullish rally. Remain cautious until such.
– Managed-Money net-longs down by 10% for week ending last Tuesday. This is welcomed.
– Momentum indicator is our Pivot; continued action below Click here to get our (FULL) daily reports emailed to you!
Gold (December) / Silver (December)
Gold, yesterday’s close: Settled at 1851.6, down 9.8 on Friday and 16.9 on the week
Silver, yesterday’s close: Settled at 24.781, down 0.119 on Friday and 0.565 on the week
– Day in and day out, we have highlight how well Gold and Silver have held ground despite U.S. Dollar strength (DX highest since July 2020) and a broadly lower Treasury complex (last week until the Friday rally). This supports a longer-term continuation of the newfound strength into Q1.
– Back and fill is important. How is it received?
– Gold Managed-Money Net longs, highest since April 2020, built out of Covid consolidation and into record summer rally. Silver, highest since June 2021 fallout.
– Comments from Vice-Chair Clarida on Friday, reevaluating pace of taper, hit Gold and Silver. Remember, very dovish November meeting, basically net-zero taper, was a bullish catalyst.
– China less hawkish, may dovish, supportive to Silver overnight.
– Silver bullish cup and handle developing out of inverse head and shoulders, holding neckline. Descending wedge handle can be very powerful.
– December option expiration today, can open up trading ranges.
– Major three-star support in Silver has been defended very well at 24.51-24.58.
– Extremely bullish upon close above major three-star resistance at… Click here to get our (FULL) daily reports emailed to you!
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