Today's Playbook - Blue Line Morning Express
Bill Baruch of Blue Line Futures - - Fri Feb 15, 8:44AM CST
Morning Express

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E-mini S&P (March)

Yesterdays close:Settled at 2743.50, down 6.0

Fundamentals:U.S benchmarks were lower overnight after again seeing the tape soften a bit into the close. After slipping last night, price action is battling back into the green on an upbeat trade rhetoric. U.S Treasury Secretary Mnuchin tweeted he had a productive meeting with Chinese Vice Premier Liu He. Chinese President Xi added that talks will continue next week in Washington. Remember, it is highly unlikely he will attend or that the leaders will meet ahead of the March 1st deadline. Headlines added, the two sides agreed to work towards a memoranda of understanding. Simply agreeing to agree that progress was made does not mean the two sides are any closer to a deal then when White House chief economic adviser Kudlow said there was significant distance between the two sides last week. There has yet to be a meeting where officials walked away with negative comments, all have applauded the progress each time. We must remind you that there has been zero progress on any on the core issues, what we have called substance; the stealing of intellectual property and forced technology transfers in order to do business within Chinas borders. Heres the caveat though, if China caves here it will hinder their ability to grow and thus drag down GDP and organic consumption. Therefore, a deal will have to arguably be offset by a reduction of the current tariff levels. On the other side of the coin, if this can gets kicked another 60 days down the road, we are midyear and guess what? That is half a year away from the 2020 election year.

In domestic news, President Trump speaks at 9:00 am CT to sign legislation to avert a government shutdown ahead of tonights midnight deadline. He is also expected to declare a national emergency at the southern border in order to get the funds to build a wall. Today, we also get a slew of economic news. NY Empire State Manufacturing is due at 7:30 am CT, Industrial Production at 8:15 am CT and then the freshest indicator each month, the first look at February Michigan Consumer data at 9:00 am CT.

Technicals:We continue to hold a slight Bearish Bias and although the S&P is up 1.5% on the week, there has been ample opportunities to trade and make money from the short side. Resistance this morning 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 54.79, up 0.48

Fundamentals:Yesterday, we got beared up in Crude Oil, please refer to yesterdays Morning Express. The market showed signs of weakness early but reversed back above resistance at the $54 mark. When this happened, we were wrong. Crude Oil does not seem that it wants to move lower and now we are embarking on a more seasonally bullish time of year. Furthermore, strong technical support has defended what we had believed to be equally strong waves of selling. Given that Saudi Arabia will reduce production in March and further reduce exports to the U.S we imagine that the one-two combination from this and a higher demand season, we imagine that Crude Oil has the gas to run to $60 over the next couple months. Furthermore, although WTI has failed to breakout, Brent has traded significantly higher for four straight sessions and is at the highest level since November.

Technicals:The roll into the April contract has removed the handcuffs on Crude against 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 1313.9, down 1.2

Fundamentals:Gold is a workhorse and continues to lay an extremely technically constructive landscape. We reiterate that we are unequivocally Bullish in Bias Gold. The Dollar Index spiked to a new March contract high this morning after ECB Member Coeure pointed to the possibility of new TLTRO (Target Long-Term Refinancing Operations). In other words, fresh easing if necessary. This is great for Gold in the long-term but as we have pointed to over this week and last as the Dollar has rallied its holding Gold back. Industrial Production data just missed, and this could start to unlock the handcuffs on Gold as the Dollar peels back but the big economic read today will be fresh February Michigan Consumer data at 9:00 am CT.

Technicals:Gold is pounding against first key 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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