September 10, 2018 - 6:00 AM EDT
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Equities Looking for Trade Bounce. Crude Bullish. Yuan Holds Back Gold

Bill Baruch, president and founder of Blue Line Futures, previews E-mini S&P, Gold, Crude, and Treasury markets and today’s economic report calendar. Follow his reports Monday-Friday on and short Midday Markets video.

Bill Baruch’s Midday Markets Minute short video for Sept. 10 here.
S&P staying below 2887. Crude price action in check, bears in driver seat. USD lower.

E-mini S&P (September)

Last week’s close: Settled at 2874.75, down 4.25 on Friday and 27.25 on the week.

Fundamentals: U.S. benchmarks are edging higher this morning and seeing relief from pressures Friday after President Trump said the third wave of tariffs worth $200 billion on Chinese goods, “could be implemented very soon.” He added that they are prepared to add another $267 billion in tariffs “in short order.”

Considering the cliffhanger on trade not only between the U.S and China but also with Canada, coupled with stronger than expected wage growth, it is fairly surprising to see another resilient bounce. It would seem that with the NQ up more than 0.5% premarket, the focus is the potential of good news from talks between U.S trade representatives and EU officials today in Brussels instead of the Apple (AAPL) letter Friday to trade representatives.

Here, the world’s largest company by market ap addressed rising costs and how this would be passed to the consumer if the next round of tariffs were imposed on China. Ultimately, the market has done a terrific job of finding the silver lining within headlines for the better part of the year, today it’s talks with the EU, and this along with an accommodative Federal Reserve is why we have remained intermediate to longer-term bullish. Though we would have expected a better than expected read on Average Hourly Earnings (the +0.4% MoM and 2.9% annualized reported on Friday’s Nonfarm Payroll report) to apply more stress to the market, it ultimately was not that hot, and it was only one number; we have pointed out that three of the last ten reads on wage growth have been revised lower.

In Sunday’s Tradable Events this Week, we laid out what to look for in the week ahead.

Technicals: On Friday’s Midday Market Minute we said that traders who sell above 2880 should have an opportunity to make money. While this played out perfectly, major three-star support at ...

Crude Oil (October)

Last week’s close: Settled at 67.75, down 0.02 on Friday and down 2.05 on the week.

Fundamentals: Crude Oil remains stable and is trading more than a dollar from Friday’s new swing low. Buoying price action was Baker Hughes rig count data that showed a decrease of two rigs. Geopolitical tensions continue to flare in the Middle East and a November deadline for countries to cease importing Iranian Crude has already tightened market dynamics as countries begin cutting in preparation. We remind you that this is supposed to be a more seasonally weak time of year and last week’s bearish EIA data gave no reason for buyers to rush to the market.

However, we did see the impact of EIA data that showed a tighter inventory picture the week before. We maintain that Crude Oil is in a seasonally bottoming phase before the next run, one that we expect to test $80. Let’s face it, last week’s low was 4.6% higher than the low on August 16 and this adds further fuel to what has been a technically constructive picture now for two and half years.

Technicals: We Neutralized our Bias to exude caution in the second half of last week. On Friday, we laid out a roadmap for what must happen to repair the immense technical damage incurred from the September 4 session reversal.

First, we did see the test and hold at our first key support at 66.75 with a low of 66.86 on Friday.

Second, price action did settle above 67.32-67.64. Now, Crude Oil becomes immediate-term bullish once again with a close above major three-star resistance at ... 

Gold (December)

Last week’s close: Settled at 1200.4, down 3.9 on Friday and down 6.3 on the week.

Fundamentals: Average Hourly Earnings beat expectations on Friday coming in at 0.4%. This was the first beat since May and the highest since December’s revision to the same mark.

The Dollar Index (DXY) gained only 0.36% on the session and Gold did not spike $10-$15 lower. We believe this speaks very loudly to Gold’s bottoming process in that the sellers have already sold. Gold could not gain fresh selling even from the algos upon Friday’s very good jobs report. This will be a critical week for the metal and there is now a tremendous emphasis on Thursday’s CPI inflation read.

The Chinese yuan (CNY) is weaker today and likely holding back the metal. This comes despite strong than expected CPI and PPI from China last night. However, this was likely offset by China’s Trade Balance data Friday night showing a new record surplus to the U.S; this assumingly does not help trade negotiations. Today there is no major economic data.

Technicals: Gold settled below the 1204 mark on Friday and the weakness into this morning is unfavorable. Still, first key support is holding, and major three-star comes in at ... 

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View a short video: Bill Baruch: Trading Futures. Gold, USD, yuan.

Recorded: TradersExpo Chicago July 24, 2018.
Duration: 4:34.

Source: (September 10, 2018 - 6:00 AM EDT)

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