CPI better, Stocks higher, Gold battling
Morning Express

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E-mini S&P (March)

Yesterdays close:Settled at 2769.50

Fundamentals:The S&P breakout yesterday was led by the Russell finally and convincingly breaking out above 1564; we have discussed at length here that this is what we needed to get bulled up once again but also gave the buy signal in ourMidday Market Minute. This morning we have the kickoff of earnings season with JP Morgan and Wells Fargo. We also have a critical CPI read, as long as this number stays right in line, maybe a tenth better, a tenth worse, the Fed will stay on this yellow brick road. However, if this read comes in hot and is accompanied by another strong Retail Sales print than investors could try to front run a less accommodative Fed and we could see a wave of profit taking. One thing we do like about the global equity market right now is how well the DAX and Nikkei are trading and holding ground on much stronger currencies, this is a sign of stability. China Trade Balance and New Loan data was underwhelming, but better than expected exports do show a stronger global economy.

Technicals:Yesterdays breakout above 2759.25-2760, as we have discussed signals a move to our next major three-star resistance target at 2783.50.Please sign up for a Free Trial at Blue Line Futures in order to view our entire technical outlook and proprietary bias and levels.

Crude Oil (March)

Yesterdays close:Settled at 63.80, nearly a dollar from its high of 64.77

Fundamentals:Brent Crude did it, it achieved $70. And then it began to reverse. The case for buying Crude at this level is extremely limited. Everyone has already bought, who is left to buy. Crude Oil import data out of China last night showed a drop of 9% MoM. Price action dipped to a session low of 63.17. Baker Hughes rig count data will be critical in a time when OPECs production cap is keeping a bid under prices and the case for U.S shale offsetting this seems to be diminishing. The rig count has dwindled at the 750 area for more than a month and a half before 5 rigs fell off totaling 742 last week. A bounce back in rig count is crucial for this retreat in price action ahead of the weekend.

Technicals:Prices are back the highest since December 2014 and since then we have not seen a daily 14-day RSI above 70 for this length of time until now.Please sign up for a Free Trial at Blue Line Futures in order to view our entire technical outlook and proprietary bias and levels.

Gold (February)

Yesterdays close:Settled at 1322.5

Fundamentals:The Dollar Index is squaring off against the September lows which would put it at the lowest level since December 2014. PPI and weekly Jobless Claims both missed the mark handily yesterday and traders brace for the main event of the week; CPI accompanied by Retail Sales. A strong CPI read would put Gold on its back foot, however, it depends how strong because there is going to be a lot of doubt surrounding higher inflation over a string of months. Gold is breaking out on a technical basis for the next leg higher.

Technicals:This is as bullish as it gets, minus the todays fundamental hurdle and resistance at 1335.8.Please sign up for a Free Trial at Blue Line Futures in order to view our entire technical outlook and proprietary bias and levels.

Natural Gas (February)

Yesterdays close:Settled at 3.084

Fundamentals:Yesterdays storage read came in at -359, a new record and topped analyst as well as our estimates. Prices have risen since and will likely do so into Monday. Weather is milder this week and next and this opens the door for a retreat after Monday, what has become a weekly occurrence; higher to start the week and price action dissipates lower.

Technicals:Price action has gotten out above first resistance and is attempting to hold. We are eyeing a trend line...Please sign up for a Free Trial at Blue Line Futures in order to view our entire technical outlook and proprietary bias and levels.

10-year (March)

Yesterdays close:Settled at 12304

Fundamentals:Treasury prices turned higher yesterday on strong demand in the 30-year auction. Still, remains subdued and hugging the 123 mark ahead of this mornings main event; CPI accompanied by Retail Sales. Business Inventories are at 9:00 am CT. Dallas Fed President Kaplan commented on expected three rate hikes, nothing new here. German officials have taken a step in the right direction in forming a government and this could explain the slight uptick in yields and small pressure on prices. Ultimately, today is all about the CPI read as this could write a chapter or two in the 2018 book.

Technicals:Price action has consolidated off extreme pressure midweek and this is good for dip buyers.Please sign up for a Free Trial at Blue Line Futures in order to view our entire technical outlook and proprietary bias and levels.

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Futures trading involves substantial risk of loss and may not be suitable for all investors. Trading advice is based on information taken from trade and statistical services and other sources Blue Line Futures, LLC believes are reliable. We do not guarantee that such information is accurate or complete and it should not be relied upon as such. Trading advice reflects our good faith judgment at a specific time and is subject to change without notice. There is no guarantee that the advice we give will result in profitable trades. All trading decisions will be made by the account holder. Past performance is not necessarily indicative of future results.