Daily markets morning round-up: E-mini S&P, gold, crude & Treasuries

E-mini S&P 500 (June)

Yesterday’s close: Settled at 2664, up 23 

Fundamentals: Global equity markets are looking to shake off geopolitical headwinds and finish a busy week on strong footing. The S&P traded down to 2652 early last night on U.S. and China trade relations again making headlines and nerves from an impending U.S strike on Syria. However, a quiet overnight session on the geopolitical front coupled with positive comments from President Trump on TPP has led to a green tape this morning. If the Syrian conflict stays out of the news today and there are now surprise announcements from the FBI, it would seem that the White House is going to try to exude positivity on the trade side; whether that be NAFTA, TPP or China. Still, we all know how fickle the news cycle is and any of the communication through Twitter can ultimately backfire. Earnings season officially gets underway today and JP Morgan is quickly up 1% on a strong read. Citigroup and Wells Fargo are also releasing ahead of the bell. We are only scratching the surface on what traders need to be looking for today as the economic calendar is loaded. Federal Reserve President Rosengren from Boston speaks at 7:00 am CT, Bullard from St. Louis speaks at 8:00 am CT and Kaplan from Dallas at noon CT. JOLTs Job Openings data is due at 9:00 am CT along with the first look at April Michigan Consumer data. Strong earnings today coupled with a better than expected read on Michigan Consumer Sentiment would be very supportive to the S&P without any heightened geopolitical surprises.

Technicals: Price action traded to a high of 2675 yesterday but was batted back down in front of our rare major four-star resistance at ... Please sign up for a Free Trial at Blue Line Futures to view our entire technical outlook and proprietary bias and levels.

 

Crude oil (May)

Yesterday’s close: Settled at 67.07, up 0.25

Fundamentals: Crude oil fell back from Wednesday’s high as the U.S. dollar stabilized on the FOMC Minutes and saw further gains on euro weakness. Additionally, a relief of geopolitical concerns on the heels of what was a bearish EIA inventory report sparked profit taking down to $66. Still, Crude battled for much of the session and news broke ahead of the 1:30 p.m. Central settlement that the United States is planning a strike on Syria. Despite managing a settlement back above $67, U.S. and China trade tensions rearose, and this led to a choppy start to today’s session last night. The highlight of today, so far, has been the IEA Monthly Report which points to strong global demand working to offset rising U.S. production. Both OPEC and IEA have suggested a potential balanced market later this year. However, the IEA firmly cautioned to trade tensions between the United States and China as a severe risk to demand. Price action jolted to a new swing high of 67.76 upon this release but has pulled back into the red this morning. Friday’s have been friendly to crude oil and while we imagine a cloud of uncertainty with the Syria conflict is and should keep a premium, traders must be cautious at these levels. Furthermore, it is imperative to have already capitalized on the rally this week. 

Technicals: Price action continues to hug what has been a massive level for us at 66.66-66.87. We had 66.87 as the next major three-star level ever since the breakout above $60. A continued close out above here is very positive and we look to today’s session to be supportive. You know that we are and have been Bullish. However, we will use this moment to caution against Sunday’s trade. 

 

Gold (June)

Yesterday’s close: Settled at 1341.9, down 18.1

Fundamentals: Yesterday was about as disappointing as it gets for us bulls without gold violating its constructive uptrend. Price action traded to a high of $1,369.4 per oz. on Wednesday but again flat out failed to hold ground above $1,360; major three-star resistance was $1,367.8 to $1,370. A combination of hawkish FOMC Minutes and weak Eurozone data has kept a bid under the U.S. dollar and this has added direct pressure to Gold. Additionally, a quick reduction in geopolitical tensions from the Syria conflict and trade tensions between the United States and China has taken the air out of the balloon. Despite news yesterday that the United States is expected to strike Syria, gold traded lower into the electronic close. This is likely due to margin selling as the settlement price was already set in place at 12:30 p.m. Central and those who chased Gold above 1350 or higher were likely forced to sell. Fed speak today will be crucial; Federal Reserve President Rosengren from Boston speaks at 7:00 am CT, Bullard from St. Louis speaks at 8:00 a.m. Central and Kaplan from Dallas at noon Central. JOLTs Job Openings data is due at 9:00 a.m. Central along with the first look at April Michigan Consumer data.

Technicals: We remain unequivocally long-term bullish Gold, but this week was a prime example in which traders CANNOT sit on their hands and must capitalize on strong moves. Price action took out first and second key support levels yesterday and we will minimally look to a close above ... Please sign up for a Free Trial at Blue Line Futures to view our entire technical outlook and proprietary bias and levels.
 

Natural gas (May)

Yesterday’s close: Settled at 2.686, up 0.011

Fundamentals: Yesterday’s storage report showed a larger draw than expected at -19 bcf and surprisingly enough, price action is holding ground on yesterday’s gains. Weather remains uncertain though choppy; many regions are not out of the woods just yet and this uncertainty is likely to keep a premium through the weekend not only because of the weekend but because of how quickly the fronts 10 days out are shifting. 

Technicals: Price action settled yesterday just below first key resistance. It will be key for the bull camp to achieve a close out above here. This level aligns with a trend line from March 13; a closeout above here could easily become bullish.


10-year Treasuries (June)

Yesterday’s close: Settled at 120’15, down 0’12

Fundamentals: The 10-year got rocked through yesterday as soft demand on auctions through the week, 30-year yesterday, finally weighed on prices as the conflict in Syria seemed to cool. Additionally, equity markets are attempting to elevate which typically weighs on Treasury prices. Today will be pivotal as geopolitics remain in the news cycle but we also have a trio of Fed speakers; Federal Reserve President Rosengren from Boston speaks at 7:00 a.m. Central, Bullard from St. Louis speaks at 8:00 a.m. Central and Kaplan from Dallas at noon Central. JOLTs Job Openings data is due at 9:00 a.m. Central. Also, at 9:00 is the first look at April Michigan Consumer data; this will be important as it shows up-to-date investor sentiment amid volatility and geopolitical and trade fears. 

Technicals: Price action fell out yesterday as the technical base gave way. The tape is now against first key support at...  Please sign up for a Free Trial at Blue Line Futures to view our entire technical outlook and proprietary bias and levels.