E-mini S&P 500 (September)
Last week’s close (Friday, June 8): Settled at 2682.50, up 6.50 on Friday and up 44.25 on the week
Fundamentals: Major U.S. benchmarks are unchanged this morning with geopolitics in focus. The economic calendar is bare to start the busiest week of the year and the world awaits President Donald Trump’s groundbreaking meeting with North Korean dictator Kim Jung Un this evening in Singapore. Equities did attempt to push north overnight despite tensions between the U.S and allies running high after the G7 Summit. For now, price action has ignored headlines that point to President Trump ‘lashing out’ against comments from Canadian Prime Minister Trudeau, Germany for NATO payments and refusing to sign a communique. Ultimately, this is nothing new and President Trump’s hardline stance was to be expected after the White House imposed tariffs on the European Union, Canada and Mexico a little more than a week ago. Yes, we did just say this is the busiest week of the year; take a look at Sunday’s Tradable Events this Week to see what’s on our radar. Markets finished Friday on a strong note and saw leadership from Consumer Staples and Health Care. Financials put in a strong week last week, recovering from the prior. While the XLF faces some technical headwinds, it will be a key sector to keep an eye on this sector as we expect tremendous volatility in yields with central banks in focus. Also, there is a 10-year auction at noon CT today. Lastly, Apple lost 0.9% on Friday due to disappointing parts orders, if it struggles early it could be a leader in risk-off sentiment.
Technicals: Our Neutral Bias approach on Friday emphasized that there are trading opportunities from either side. Friday’s strong close cannot go ignored but we do feel the upside is becoming limited in the very near term. The slightly lower open last night gives a solid line in the sand for a marginal Neutral/Bullish Bias. First key support comes in 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 (July)
Last week’s close: Settled at 65.75, down 0.21 on Friday and down 0.07 on the week.
Fundamentals: OPEC’s June 22nd meeting is quickly coming into focus and the price of Crude Oil has suffered despite tensions between members running high. There were reports last week that Saudi Arabia added 100,000 bpd last month. Additionally, data to start the month suggests Russia has increased production to 11.1 mbpd, higher than the rough 11 mbpd ceiling they agreed to. Crude was working to recover from its sharp selloff through May 29 but saw further pressure last week after news broke that a high ranking White House official asked Saudi Arabia to increase production in order to offset Iran sanctions before the White House announced their decision. Crude oil has already dropped more than 10% from its peak on this news. Price action will stay volatile, but we steadily maintain that the risk is to the upside. Furthermore, we believe the highest producing nations of the OPEC and non-OPEC accord are taking advantage of what has become a gray area of compliance ahead of the official OPEC meeting. OPEC is due to release their Monthly Report tomorrow morning and the IEA releases theirs Wednesday ahead of inventory data.
Technicals: Crude Oil is down about 1% this morning and despite signs of strength heading into Friday, major three-star resistance at 65.80-66.08 won another battle. Yes, fundamentals are weighing on the tape today.
Last week’s close: Settled at 1302.7, down 0.3 on Friday and up 3.4 on the week
Fundamentals: This is the week that both the bulls and the bears have been waiting for. It kicks off with the groundbreaking meeting between President Trump and North Korean dictator Kim Jung Un Monday night (U.S hours). Tuesday, we see fresh inflation data with CPI. Next comes a trio of central bank policy meetings, the Federal Reserve on Wednesday, the ECB Thursday morning and the Bank of Japan late Thursday night. Volatility in the currency market will be critical to the Gold trade, a stronger Dollar will weigh on the metal while weakness will lift it. We discuss how the week sets up in Sunday’s Tradable Events this Week. There is no data on the U.S calendar today, but a 10-year Note auction comes at noon CT.
Technicals: Thursday was yet another failed attempt to get out above major three-star resistance at 1308.7-1309.6. Still, price action has battled like a champ to hold the psychological $1300 mark. According to the Commitment of Traders, Managed Money began repositioning long gold, but still remains at the lowest level in a year.
Natural gas (July)
Last week’s close: Settled at 2.89, down 0.04 on Friday and down 0.072 on the week
Fundamentals: Natural Gas continues a consolidation phase and buyers defend pullbacks with the prospects of a higher demand for cooling days quickly approaching. The 10-day forecast calls for temperatures hitting above 90 degrees in the Midwest with the East Coast following behind. We maintain that the overall fundamental risk is to the upside through July, but question where the value is.
Technicals: Price action traded to a low of 2.875 on Friday, higher than that from Wednesday. A positive start to the week has continued to build a base above major three-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.
10-year Treasuries (September)
Last week’s close: Settled at 119’19, unchanged on Friday and down 0’08 on the week
Fundamentals: The biggest week of the year gets underway. Tonight’s meeting between President Trump and North Korean dictator Kim Jung Un kicks things off, but there is a 10-year auction at noon Central in an otherwise bare economic calendar to start the week. CPI data tomorrow is our number one Tradable Event this Week for the tone it could set ahead of the trio of central bank policy meetings. We discussed last week that it is likely to see pressure on the 10-year ahead of Wednesday’s FOMC Meeting, after all, we are in a hiking cycle. Equity markets continue to trek higher and this has only encouraged that pressure. We still feel it is likely, depending on how things play out, that the 10-year bottoms, at least in the near/intermediate term, over the next week and a half.
Technicals: Price action is back below our crucial pivot level but managed to settle within it Thursday and Friday. We like patiently positioning long on dips, 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.