Hit the Mark Trading’s Brief Review of Overnight Market Action Setting the Tone for the Trading Day
Off with His Head! Well this was predictable…
Wells Fargo fires their CEO John Stumph, effective immediately. Take your millions and leave! It will be interesting to see if this action pushes Wells Fargo stock higher.
Metals and China are like fish and water… one cannot survive without the other.
This from ft.com writing on Chinese metal imports: Imports of copper metal and semis fell 2.9 per cent in September to 340,000 tonnes, and 25 per cent from the previous year. That’s the biggest yearly drop in absolute tonnage since January 2015, according to Barclays.
Here is the Bloomberg take: China registered in September the steepest monthly drop in its exports since February with a 10 percent year-on-year contraction in dollar terms compared with expectations for a 3.3 percent decline
Why is this important? Well, on the macro, this information is an additional data point showing the sluggish global growth…showing the continued lack of demand for physical commodities, and places into question the idea of China achieving their GDP growth numbers for 2017. Yes, we are talking the health of the second largest economy in the world.
Additional Market Commentary:
- Copper has what I consider a “market structure” formation indicating a potential move lower, once the lows of October are taken out…possibly today. Look for $2.00 copper.
- VIX pops higher, yet remains under 20…so no big deal…yet. Equity index futures we follow are all lower globally. Look for 2100 on ES retesting September lows.
- Crude, can you salvage today’s “risk-off” mentality? Crude report today at 11AM ET, delayed this week due to Monday USA holiday.
- I warned in last night’s video how Natural Gas could fall on a possible “risk-off” market attitude taking most all instruments lower. Well…it’s happening. Anyone in the educational trade that saw $2000 in simulated profits should carefully consider the stop levels mentioned last night…or simply take gift.
- US dollar incrementally lower. That means gold is incrementally higher. 1253 continues serving as our line in the sand for bullish or bearish bias. Incredible support here.
- Euro closed EXACTLY on our support line and is higher today. Our mantra…”the line holds until it does not!” Euro good for day trading.
- Pound seeks out two green days after the latest drop.
- Yen incrementally higher on “risk-off” attitude.
- Aussie recovered overnight drop associated with China’s metals import data. Canadian dollar attempting a base. Did you know seasonal tendency called for Canadian dollar’s drop? We cover this in the Trader Weekly Review.
- Softs very quiet. Quiet in the softs means only one thing…avoid.
- Bonds saw strength yesterday on the FED expressing concern over the USA housing market. Importantly, we have, so far…follow-through. 30 year bond auction at 1PM. Retail traders should, in my opinion, avoid bonds at this time of the day.
- Deutsche Bank imposes partial hiring freeze. This is admission they are trying to lighten the plane which is running out of fuel. Short sellers could re-double efforts here.
The U.S. military directly entered Yemen’s war for the first time, launching three strikes on areas controlled by Yemen’s Houthi rebels after an American navy ship was targeted by two failed missile attacks this week (Bloomberg). Gold watches geopolitical turmoil as a reason to rise.
The U.S. Department of Labor said the number of individuals filing for initial jobless benefits in the week ending October 8 held steady at 246,000. Analysts expected jobless claims to rise by 8,000 to 254,000 last week.
- Jobless Claims – 8:30 AM ET
- Import and Export Prices – 8:30 AM ET
- Bloomberg Consumer Comfort Index – 9:45 AM ET
- EIA Natural Gas Report – 10:30 AM ET
- EIA Petroleum Status Report – IMPORTANT – 11:00 AM ET
- 3-Month Bill Announcement – 11:00 AM ET
- 6-Month Bill Announcement – 11:00 AM ET
- 30-Yr TIPS Announcement – 11:00 AM ET
- Patrick Harker Speaks – 12:15 PM ET
- 30-Yr Bond Auction – 1:00 PM ET
- Treasury Budget – 2:00 PM ET
- Fed Balance Sheet – 4:30 PM ET
- Money Supply – 4:30 PM ET
- Neel Kashkari Speaks – 9:00 PM ET
To learn more from Martin, visit HitTheMarkTrading.com to join his mailing list and receive blog updates.