The FOMC members will gather today for a two-day meeting. It will be the most important event this week, since Powell will chair the meeting for the first time. Gold investors want to get to know him better as the uncertainty makes them a bit nervous.
Yesterday’s bludgeoning came to a quick end just ahead of the close and against the second major three-star support on the day. The S&P lost more than 2% on its low of 2697.25, but pared losses to settle down only 1.2%.
Equity markets, led by the tech sector and FANG stocks, turned sharply lower overnight. The Nasdaq lost as much as 116 points and traded down 1.65% early this morning. Friday’s strong session was very technical in nature and the move was building up through week. When bearish news does not take a market lower, it can sometimes signal an adverse move is around the corner.
Soybeans and crude oil have the most trending pivot math for the coming week, and all of my tracked symbols have narrow ranges on one or more of daily, weekly, or monthly charts. The Aussie, Pound, Crude, and Gold are range-compressed on all three charts! Breakouts are brewing.
Equity markets have taken it on the chin this week with trade worries and White House drama in the forefront. While the tape has given bulls fits, price action in the S&P is attempting to stabilize at the level in which it broke out on Friday’s jobs data.
Gold has now recovered from being negative to close the day higher on three occasions in as many days since Friday. The bulls’ resilience is noteworthy, but not exactly remarkable as there has not been much follow-through yet. Indeed, the metal was trading lower again at the time of this writing.
Yesterday was a tough session for market bulls, and we took our licks. CPI data was in line with expectations and this did pave the road higher for equity markets; the S&P traded to a new swing high of 2807.25 and the Nasdaq extended to a new record. Not so fast though, the White House took another dramatic turn with the release of Secretary of State Rex Tillerson.