Today's Playbook - Blue Line Morning Express
Bill Baruch of Blue Line Futures - - Thu Mar 14, 9:11AM CDT
Morning Express

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E-mini S&P (June)

Yesterdays close:Settled at 2819.50, up 22.25

Fundamentals:U.S benchmarks stretched gains early this morning on the European open as markets digested the March 29th Brexit deadline getting kicked down the road. This outcome was expected as a worst-case scenario early in the week and there is reason to believe that global markets have already priced it in; meaning the 3:00 am CT spike was more of a gasp for air. In China, the Shanghai Composite lost more than 1% for the second day in a row. Last nights Chinese Industrial Production data came in below expectations at 5.3% versus 5.6%, the other trio of reads was in line. Trade is also weighing on sentiment though much less than we would expect. A meeting between President Trump and President Xi is said to be delayed until April at the earliest; at the earliest leads us to believe much later than. U.S Trade Representative Lighthizer testified before the Senate Finance Committee yesterday and a large part of his discussion was on enforcement and the U.S being able to implement tariffs if China is not compliant to the deal reached. Furthermore, it came to light that the two sides are further apart than headlines have led you to believe. Really? There has been a lack of substance amidst the trade negotiations and intellectual property remains a very divisive issue; we have been saying this for months. President Trump added yesterday that he is in no rush to complete a deal with some understanding his comments as signaling the probability of a deal is only 50/50 at this point. Gary Cohn, former head economic advisor, added in comments yesterday that Trump needs a win. Still, U.S benchmarks are holding at the highest level of the year. Initial Weekly Jobless Claims came in slightly higher than expected this morning while Import/Export Price Index was a bit better. We look to New Home Sales and the NAHB Housing Market Index at 9:00 am CT.

Technicals:Price action melted higher yesterday, and we said here, Today is starting to develop as a session that you do not want to fight from the short side. Keep a pulse on the open and a move out above 2805-2807.75 early in the S&P will almost certainly signal it wants to extend gain into the thick pocket of a major three-star resistance at 2814-2819. Yesterdays high was 2826.75 and the tape has stayed elevated into this morning with only minor pullbacks. Earlier in the week, we pointed out that because of the March to June roll, our levels will tighten up as the week develops. Major three-star resistance now 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.

Crude Oil (April)

Yesterdays close:Settled at 58.26, up 1.39

Fundamentals:Yesterdays weekly EIA inventory report helped fuel a breakout session in Crude Oil. The headline read was a draw of -3.862 mb of Crude, more than the -2.6 mb posted by the private API survey the day before. Recent Baker Hughes rig data was confirmed as estimated production in the lower 48 states fell by 100,000 bpd and this coupled with -4.624 mb of Gasoline and -0.672 mb at Cushing also lifted the tape. OPECs Monthly Report was released this morning and hasnt moved the tape much. Their production in February fell 221,000 bpd and they revised the demand for its Crude 130,000 bpd lower. They also highlighted that rising non-OPEC supply is an ever-present reason they must stick to their production cut pact. For the most part, this has been priced into the market due to Saudi Arabia saying earlier in the week they will further decrease exports and production.

Technicals:Price action finally broke out of the range that we have defined for exactly a month after closing out above 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.

Gold (April)

Yesterdays close:Settled at 1309.3, down 11.2

Fundamentals:Gold has been under heavy pressure into this morning despite only a small uptick in the Dollar Index as well as the Dollar/Yuan. Gold did rally ahead of yesterdays Brexit Vote and although the results were expected, it seems to be coming in now that the deadline will officially be extended. Overall, there also seems to be rising concerns that a trade deal between the U.S and China will be harder to reach than recent headlines have eluded to. From this, we believe Gold bulls are very nervous to get caught in a similar downdraft as last year. We do not find this to be the case given the 180 from central banks around the world. Although we remain unequivocally bullish Gold long-term, this tape does exude a that bulls should be patient. Initial Weekly Jobless Claims came in a bit higher than expected while Import/Export Price Index was slightly better. New Homes Sales and the NAHB Housing Index is due at 9:00 am CT.

Technicals:Gold pushed to a high of 1311.6 post-settlement yesterday and ahead of the Brexit vote. There was strong sell-volume early in U.K hours this morning and price action is back below a significant level 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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