E-mini S&P Futures (September)
Yesterday’s close: Settled at 2889.75, up 24.25
Fundamentals: U.S benchmarks are surging higher. The tables turned through yesterday morning after major three-star support held a retest at 7:00 am CT. Freshly upbeat rhetoric surrounding U.S and China trade has added a tailwind to yesterday’s firm session. Headlines read ‘China Indicates It Won’t Retaliate Now on New U.S Tariffs’ from Bloomberg while Reuters points to comments from China’s Finance Ministry spokesperson calling for the U.S to “create favorable conditions” for September talks. All are implying significant progress is about to be made and we again find ourselves at peak optimism in the trade-talks-jawboning cycle.
On the economic calendar, we look to the first revision to U.S Q2 GDP. It is expected to come down a tenth to 2.0%. We also look to components such as Core PCE Prices, Corporate Profits, Real Consumer Spending which surged by 4.3% and Wholesale Inventories to accompany weekly Jobless Claims.
Technicals: Key resistance at 2888.50-2891.50 in the S&P and 7600.50-7618.25 in the NQ kept a ceiling on price action until 2:00 am CT when the news cycle on trade hit the tape. We have now seen a surge through major three-star resistance at 2899.50-2904.25 in the S&P and out above the 100-day moving average at 2914.75; above here the path of least resistance again favors a direct test to a wall of resistance at 2932-2944.25 that we have now denoted as a rare major four-star level. A close above this strong wave of resistance would be considered a bullish breakout, in the same manner, a close above 7789.50-7808 should be treated in the NQ. To the downside, 2899.50-2904.25 in the S&P will act as first support and bring a swing trade opportunity upon the first test. Furthermore, major three-star support comes in at 2888.50-2891.50, a level that we have had over and over, today it aligns with yesterday’s settlement. This can be used as a backstop on such a swing trade and we feel confident that upon a test here price action should bounce. However, a move decisive move through here with strong volume is bearish. The first key support in the NQ comes in at 7648.50 and above here, the bulls are in the driver’s seat on the session.
Support: 2899.50-2904.25**, 2888.50-2891.50***, 2875.25**, 2865.50-2866.75*, 2851.50-2855.50***
Resistance: 7681*, 7731.75--7748**, 7789.50-7808***
Support: 7648.50**, 7599.25-7618.25***, 7548.50**, 7490-7504.50***