The collision of global markets and social mood

Monday, November 7, 2016

Monday -- Mind The FBI Gap

S&P E-mini Futures:
Sharply higher, leaving a huge gap from Friday.

Sea Of Green worldwide on the FBI's director's Sunday afternoon back flip.

Quote of the day: “A Clinton win would clear the decks for the Fed to raise rates in December and for markets to price in a more aggressive profile for tightening over 2017,” said Sean Callow, a senior strategist at Westpac Banking Corp. in Sydney. (via ZeroHedge)

In other words, futures probably not pricing in a one-way jet ride to new record highs.

Elsewhere, jeweler Blue Nile sold to Bain Private Equity for $500 million, a 34% premium.

Animal spirits still alive and well even after the longest string of down days in the market since 1980.

Fantastic Fearless Fall -- just think, a fashion mag warned you in early September.

Hot mess of Risk On amid dollar strength. Mind Mr. Callow's quote above.

Gapped lower yet struggling higher.

WTI crude and NG gapped lower.

Gold and silver gapped lower and remain so. Platinum gapped lower and is struggling back, while palladium and copper rallied strongly higher. Mixed action here according to mixed uses.

S&P Outlook:
Friday's action was not encouraging. Nor was the overnight action in futures. Sure it's great for my positioning but it has the knee-jerk feel of emotional, news-related trade that eventually gets entirely retraced.

Candidly, not sure if either candidate will want to be president after the election.

The market could target the volume shelf at the 2130 area which coincides with the 61.8% retracement of the recent decline, but it has to make it through the 38% level first, close above it, and do so convincingly.

That level is 2110.91.

Any failure would likely presage bad news.

Thus today and tomorrow might represent an ideal hedging opportunity.

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