Market Overview – Morning Express
– Do not miss our Top Three Things to Watch this Week, every Sunday
– Stocks slipped midday Friday, S&P and NQ both cracked crucial levels of support, after U.S. officials warned Russia planned to invade Ukraine next (this) week.
– No progress on Saturday call between U.S. President Biden and Russian President Putin.
– S&P lost as much as 1.1% as fears of potential invasion rattled global markets.
– U.S. benchmarks pared losses, turn positive, after Russian Foreign Minister Lavrov made headlines.
o Move forward with diplomatic talks.
o Indefinite talks are not possible
o Putin agreed
– St. Louis Fed President Bullard spoke with CNBC and reaffirmed his stance of 100 basis points in hikes by July 1st.
– Bullard: it was not only Thursday’s January CPI data but reads from October onward that question the idea inflation will moderate without Fed action.
– Bullard’s 100 basis points of hikes only 25bps more than initially projected
– Bullard: must prepare for scenario that inflation does not moderate in second half of 2022.
– Earlier this morning Kansas City Fed President and 2022 voter said no reason for inter-meeting hikes. Reiterated using balance sheet as a tool to ease path of rate hikes.
E-mini S&P (March) / NQ (March)
S&P, yesterday’s close: Settled at 4409.50, down 88.00 on Friday and 83.00 on the week
NQ, yesterday’s close: Settled at 14,240.50, down 460.50 on Friday and 445.00 on the week
– Huge levels of support were taken out on Friday; S&P 4440-4446 and NQ 14,416-14,483.
– Previously strong support should bring strong resistance; must close above these levels to neutralize Friday’s weakness.
– Pivot and point of balance aligns Friday’s intraday low with settlement
– January 28th midday whipsaw range, pre-rally, aligns with lows from overnight.
– Remember, selling has taken place late in the session.
– A break below and close below … Click here to get our (FULL) daily reports emailed to you!
Crude Oil (March)
Yesterday’s close: Settled at 93.10, up 3.22 on Friday and 0.79 on the week
– Price action surged to a high of 94.66 on Friday, ahead of settlement, on reports of Russian invasion this week.
– Settled at our next major three-star resistance at 92.96-93.50, a level that held the February 4th high in check.
– Iran is pushing for Nuclear Deal, weighing on tape
– Interesting comments from UAE Energy Minister: Russian invasion of Ukraine unlikely. Also said that OPEC has spare capacity to meet demand.
– A tone of progress was struck, selling began at the European open.
– Rising momentum indicator should flatten out and aligns with the 92.96-93.50 pocket; below here signals near-term exhaustion.
– The tape is still very bullish, but arguably over-extended and susceptible to two-sided swings associated with geopolitical headlines.
– Strong support will look to stave off added selling and present possible swing opportunity at … Click here to get our (FULL) daily reports emailed to you!
Gold (April) / Silver (March)
Gold, yesterday’s close: Settled at 1842.1, up 4.7 on Friday and 34.3 on the week
Silver, yesterday’s close: Settled at 23.369, down 0.153 on Friday and up 0.894 on the week
– Rally in Gold and Silver was post-settlement Friday.
– Crucial for precious metals traders to decipher impact between Fed and geopolitical headlines; which tailwind is working more or less.
– Bullard was not more hawkish than last time, was seen as supportive to PM complex.
– The decisive close on the week above 1832, also Thursday’s pre-selloff settlement of 1837, is enough to increase Bias to more Bullish.
– Potential breakout building, but prudence must be held: do not chase excessively and define your risk if so.
– Managed Money Net-Long small uptick of 20k contracts in week ending last Tuesday. Yes, a 40% increase but still 65% below any meaningful level.
– This means there is great room for adding buying.
– Still, prices face massive overhead resistance, while Gold is above January highs Silver still must repair such damage.
– Gold faces major three-star resistance aligning with 50% from entire pandemic range at 1881, the level in which it failed in November.
– Bulls in the driver’s seat as long as price action holds above … Click here to get our (FULL) daily reports emailed to you!
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