Trading the Noise - Blue Line Morning Express
Morning Express

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E-mini S&P (December)

Yesterdays close:Settled at 2640, down 56.25

Fundamentals:The global picture is stable this morning with U.S benchmarks gaining ground after two consecutive days of losses. Continued friction between the U.S and China and weaker growth forecasts have arguably been digested. At this crossroads, it is now a matter of adding fresh negative news or one of two tailwinds take hold; a less hawkish Federal Reserve or bullish seasonals. Heading into this week, before the APEC conference took a turn for the worse escalated trade tensions, we had been eyeing the EUs response to Italy this morning. Ultimately, it appears to be more of a kick the can down the road approach. There are no immediate disciplinary actions, but the EU will open a disciplinary procedure called the Excessive Deficit Procedure (EDP). This gives EU members two weeks to decide if the EDP should proceed. Furthermore, last week Germanys Finance Minister spoke in an acceptable manner when referring to Italy and when it comes down to it, Italys budget does not cross the 3% deficit threshold. All in all, this has been a very soft reaction and the Euro as well as the DAX are responding well; the market has cleared this hurdle. Adding fuel to price action this morning was an announcement that trade-war ringleader Peter Navarro has been excluded from the Summit at the Summit; this is seen as very favorable towards progress on a deal.

Todays economic calendar is busy ahead of the Thanksgiving Holiday (we emailed a schedule of trading hours for all products at yesterdays close). We look to Durable Goods and weekly Jobless Claims at 7:30 am CT. At 9:00 am CT we get the freshest data point each month in the first look at Michigan Consumer data along with Existing Home Sales.

Technicals:Price action traded to a low of 2631.75 at 2:00 pm CT yesterday. This was the second test at 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.

Crude Oil (January)

Yesterdays close:Settled at 53.43, down 3.77

Fundamentals:Crude traded to the lowest level in more than a year yesterday upon a barrage of punches. Broad sentiment was moving risk-off since the overnight and this pulled Crude down and created another technical failure against strong resistance; what we have described as stair-stepping lower. On Monday, the December contract fell off the board and typically, especially after such a violent end to a contract, the next 24 hours are volatile. Also weighing on the tape were official expectations of yet another inventory build for Crude. Lastly, President Trump decided to not take action against Saudi Arabia or the Crown Prince over the Khashoggi killing. Not only was an alliance here seen as favoring lower Oil prices, President Trump outright voiced that he wants lower Oil prices. Upon such, Crude plummeted in a precipitous drop that certainly found an air-pocket below the November 13th low. After trading to 52.77, Crude is up more than 2% this morning on better global risk-sentiment and after API reported a draw of 1.545 mb. Todays official EIA expectations are for +2.5 mb Crude, -0.198 mb Gas and -2.754 mb Distillates. The continued rise in estimated production must also be watched closely.

Technicals:Crude Oil certainly has its work cut out for it as major three-star resistance 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.

Gold (December)

Yesterdays close:Settled at 1221.2, down 4.1

Fundamentals:Gold is regaining ground this morning on the Dollars dissipating strength. The Euro is in the green on what has been a favorable reaction thus far to Italys budget and the Chinese Yuan has strengthened on news that trade-war ringleader Peter Navarro will not attend the Summit at the Summit. Furthermore, Durable Goods and weekly Jobless Claims both missed this morning. All of which coupled with a less hawkish Federal Reserve lays a constructive fundamental groundwork for Gold. Still, traders want to be cautious of the seasonally soft time of year and a potential rebound in the risk-on trade in equities. Lastly, while we are long-term bullish Gold, technical headwind is strong.

Technicals:Yesterday, Gold failed directly at our 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.

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Futures trading involves substantial risk of loss and may not be suitable for all investors. Trading advice is based on information taken from trade and statistical services and other sources Blue Line Futures, LLC believes are reliable. We do not guarantee that such information is accurate or complete and it should not be relied upon as such. Trading advice reflects our good faith judgment at a specific time and is subject to change without notice. There is no guarantee that the advice we give will result in profitable trades. All trading decisions will be made by the account holder. Past performance is not necessarily indicative of future results.