Watch the Treasury fallout closely, lower prices (higher yields) will be a headwind to risk-assets, states Bill Baruch of BlueLineFutures.com.
E-mini S&P and E-mini NQ futures were slammed into the close yesterday, but levels are so far holding. Gold and Silver are exuding underlying strength. Crude has been on a bull run. Is the party about to start?
E-mini S&P (December) / E-mini NQ (December)
S&P, yesterday’s close: Settled at 4372.00, down 75.00
NQ, yesterday’s close: Settled at 14,862, down 289.25
E-mini S&P and E-mini NQ futures were slammed in the final 90 minutes, after failing to chew through resistance aligning with the opening bell range. This has created several layers of technical headwinds, all detailed in the levels below, but the first psychological hurdle will be 4397.75-4400 in the E-mini S&P and 15,001-15,020 in the E-mini NQ. This would clear the opening bell range for the E-mini NQ, but the E-mini S&P must tackle major three-star resistance at 4418.50 to achieve that feat. If such is accomplished, this should set each index on a path to cover Wednesday’s closing gap; rare major four-star resistance at 4442.50-4447 in the E-mini S&P and 15,152-15,198 in the E-mini NQ. To the downside, the E-mini S&P broke to the lowest level since June and pinged a pocket of support aligning with the early June breakout and consolidation, whereas the E-mini NQ held out above the August low. These levels could provide formidable ground, but a violation and close below such would likely create a windfall of selling.
Resistance: 4392.50-4393.50, 4397.75-4400, 4407.75, 4412.25-4414.50, 4418.50, 4430.25-4434, 4442.50-4447, 4462.25-4466
Support: 4365-4373, 4352, 4328, 4304.75-4319
Resistance: 15,001-15,020, 15,044-15,048, 15,152-15,198, 15,248-15,278, 15,351-15,382
Support: 14,836-14,862, 14,792-14,817, 14,554-14,556, 14,332-14,385
Crude Oil (November)
Yesterday’s close: Settled at 89.63, down 0.03
Crude Oil futures continue to hold ground, battling constructively at and around the psychological $90 mark, while weathering the October expiration headwinds we detailed early in the week. This is extremely impressive and speaks volumes to its underlying strength. We will be very curious to see the latest Commitment of Traders data later this week. Per the Morning Express on Tuesday, “The price surge has not gone unnoticed; the Commitment of Traders shows the Managed Money Net-Long at the highest level since January 31, 2022. However, it is important to understand the Managed Money Net-Long position gravitated between this level and as much as 50% higher from June 2020 through June 2021.”
Wednesday and Thursday have failed to clear resistance at 91.07-91.27, and today’s early rejection has made this major three-star resistance and a line in the sand for the bulls to reinvite fresh buying into the weekend. To the downside, our momentum indicator is rising and aligns to create major three-star support at 89.91-90.05, a break below here will signal some near-term exhaustion and encourage a continued consolidation at best.
Resistance: 91.07-91.27, 91.55-91.86, 92.43-92.64, 93.62-93.74
Support: 89.91-90.05, 89.63-89.74, 88.65-88.97, 88.37, 87.74-87.88, 87.25-87.49
Gold (December) / Silver (December)
Gold, yesterday’s close: Settled 1939.6, down 27.5
Silver, yesterday’s close: Settled at 23.687, down 0.149
Gold and Silver futures rebounded from session lows early yesterday. The low came in on the much better-than-expected Jobless Claims read; at 201k it was the lowest since March 30. Silver went on to set a fresh high on the week, achieving 24.05 overnight, whereas Gold has been contained below Wednesday’s electronic close of 1951.3. For Silver, we must see it hold out above Wednesday’s gap settlement and previous resistance at 23.76-23.85; surrendering this would be detrimental in the near term and potentially intermediate.
While Silver has exuded an underlying strength since last week’s sharp reversal of significant support at 22.55-22.72, it still must chew through the supply created from the September fifth fallout. We have rare major four-star resistance aligning with the .618 retracement back to the September high at 24.33 and the Friday, September first settlement of 24.56; a close above here would be very bullish. As for Gold, it must get out above rare major four-star resistance aligning with the pre-FOMC high and settlement at 1966.4-1971.1.
Resistance: 1950.8-1952.2, 1957.7-1958.9, 1966.4-1971.1
Support: 1937.2-1939.6, 1931-1933.1, 1921.7-1926, 1913.6-1916.2
Resistance: 23.99-24.05, 24.33-24.56
Support: 23.76-23.84, 23.49-23.54, 22.99-23.06
Learn more about Bill Baruch at Blue Line Futures.