Hit the Mark Trading’s Brief Review of Overnight Market Action Setting the Tone for the Trading Day
Remember Brexit and all the fear churned by the media aligned with the government? Remember all stake-holders who were interested in the status-quo cried doom and gloom? Remember foreign governments…including USA warning against Brexit?
Well, UK 3rd quarter shows the sky did not fall. Rather, the upside shows the strength of the economy and the people of UK despite all the noise, worry, and hand-wringing. There is a lesson there if you care to learn.
UK year over year GDP growth is 2.3%, which is likely better than what the USA will report on Friday. For the quarter, UK GDP consensus called for 0.3% growth…however growth registered 0.5%.
Last night I sent this quote out from a professional trader lamenting the current state of trading…
“Look, its really important to understand how fast things are evolving. Both big and small accounts that try and trade futures get run over. The big $10 and $20 billion dollar funds are like deer in the headlights, and the only thing the little guy has on the big fund is we can turn the screens off and walk away for lunch or golf, they can’t.”
In Other News…
The USA Durable Goods report came out below consensus in what is considered a flat reading. New orders for the month -0.1% reading. Year over year the change is 1.6%, which is nothing special.
Jobless Claims continue at a relatively low rate of 258K new claims, at or near historic lows (econoday.com).
Qualcomm is buying competitor NXPI for $47 billion. Markets love big mergers due to ingrained knee-jerk of a paradigm that says “if these big mergers are occurring, that’s evidence of confidence in a better tomorrow.”
Tesla reported it’s first quarterly profit in 3 years. There are some folks shorting Tesla in a world of hurt as the stock rises 4% pre-market and is likely to continue moving higher on prospects of future profitable quarters.
Profits at S&P 500 companies have largely exceeded analysts’ estimates for the third quarter so far, setting up for the first profit growth since the second quarter of 2015 (Reuters).
- Durable Goods Orders – 8:30 AM ET
- Jobless Claims – 8:30 AM ET
- Bloomberg Consumer Comfort Index – 9:45 AM ET
- Pending Home Sales Index – 10:00 AM ET
- EIA Natural Gas Report – 10:30 AM ET
- Kansas City Fed Manufacturing Index – 11:00 AM ET
- 3-Month Bill Announcement – 11:00 AM ET
- 6-Month Bill Announcement – 11:00 AM ET
- 7-Yr Note Auction – 1:00 PM ET
- Fed Balance Sheet – 4:30 PM ET
- Money Supply – 4:30 PM ET
- We are in “risk-on” mode for equity index futures and any rise in crude should support further gains in ES, et. al. I will not be surprised if the market initially sells strength and then we see weakness bought based on one of our benchmarks.
- All global equity index futures higher.
- Gold remains dangerous nickel and dime trading.
- Soybeans popped yesterday on rumors the Chinese were massive buyer trying to lock-in purchases as their currency continues depreciating. This is likely short-lived.
- Coffee strength continues as the nightly video service has charted.
- Bonds lower on initial claims report and continued sell-off of European bonds.
- Currencies incremental moves and dangerous. Yen moving as expected for nightly video clients.
- Crude oil never forget $50.00 is a bloody battlefield for bulls and bears. Therefore, this level is a potential pivot.
Think About This!
This morning, while researching Rooster Call, I took a crude trade looking for a nice run…only to find out crude is in a “nickel and dime” mode. I took my 3 tick loss after nothing happening. Using trend and momentum, we are severely challenged if price is not moving. Here is where the 15 minute trader might simply put on a trade, with protective stop and then walk away. That’s the kind of market in crude so far…it will likely move as I finish up this writing.
To learn more from Martin, visit HitTheMarkTrading.com to join his mailing list and receive blog updates.