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Futures

Blue Line Futures - Morning Express


E-mini S&P (December)

Yesterday’s close: Settled at 2921.25, down 4.25

Fundamentals: U.S. benchmarks remain steady ahead of today’s Federal Reserve interest rate hike. Our narrative at Blue Line Futures has been that the Fed is in the driver’s seat and we have leaned on corrections as buying opportunities because when it comes down to it, the Fed is only gradually hiking rates and their cycle is peaking. With policy likely staying accommodative for the longer-run, this could be only the early stages of a bull market. Now, this is not to say we won’t see corrections of 5-10%, but again, these are buying opportunities. Of late, we have expressed our belief that the market is at such an impasse and is due for a minor correction at minimum. Many times, separate asset classes price-in expectations differently and thus react accordingly. For instance, the Federal Reserve is in a hiking cycle and for this reason it is not uncommon to see Treasury yields trade higher into meetings as those who are long portfolios of bonds taper to reduce risk. On the surface, this would signal hawkish expectations. However, equity markets typically stay bid into meetings in a ‘prove-me-wrong’ manner but ultimately, as we stated above, the Fed’s policy is accommodative and will likely be so for the longer-run. As this year has unfolded, the Fed has expressed their concern for the escalating international trade conflict. However, it is our belief that they expected to see a brighter light at the end of the tunnel heading into this meeting. With talks between the U.S. and China deteriorating and no clear headway on the NAFTA front, we expect them to increase their concern. While this would be taken as dovish, instead of providing a tailwind, elevated valuations are likely to take notice.

New Home Sales are due at 9:00 am CT.

Technicals: Price action has remained rangebound and defined by first key resistance and major three-star support. For those trading a shorter time frame, there have been multiple opportunities to capitalize on the technicals as the week has unfolded. Our Bias has leaned Bearish since late last week and price action has remained heavy trading through major three-star support each of the last two days. However, buyers have been resilient. This has forced us to recalibrate our support levels and instead align ... Please sign up for a a Free Trial at Blue Line Futures to view our entire technical outlook and proprietary bias and levels.

 

 

Crude Oil (November)

Yesterday’s close: Settled at 72.28, up 0.20

Fundamentals: Crude Oil has had a strong week but faces two clear fundamental hurdles this morning. First, yesterday’s private API survey was bearish showing a surprise build of 2.903 mb. While the market clung to gains overnight, traders are likely to get increasingly prudent ahead of the official EIA data at 9:30 am CT. The other headwind has been the rhetoric on the street. Yesterday, President Trump called out OPEC for keeping prices high and it’s likely the White House releases from the Strategic Petroleum Reserve sometime soon. The SPR would only have a short-term effect and is becoming increasingly expected. Additionally, Goldman Sachs said yesterday that production increases from the OPEC and non-OPEC alliance will make up for what comes off the market due to Iran sanctions. While we partially agree with this, the bullish factor is the reduced spare capacity. Today’s EIA report will be crucial as the market is emerging from the loll season. The expectations are for; -1.279 mb Crude, +0.788 mb Gasoline and +0.752 mb Distillates. Cushing and production must be watched closely.

Technicals: Price action has stayed extremely constructive in the intermediate to longer-term, however, it was unable to extend gains and move out above first key resistance at 72.71-72.95. Furthermore, the tape is below our immediate-term momentum indicators this morning. This was something we expected in the second half of yesterday’s session and spoke to clients about at the trade desk. For this reason, our Bias ahead of inventory data has become more Neutral. We firmly believe pullbacks are buying opportunities, but we need to see them. A test and hold of major three-star support at ... Please sign up for a a Free Trial at Blue Line Futures to view our entire technical outlook and proprietary bias and levels.

 

 

Gold (December)

Yesterday’s close: Settled at 1201.7

Fundamentals: The Dollar is gaining ground this morning ahead of today’s Fed decision. A hike today is priced in, the question surrounds their tone moving forward. As we stated in the E-mini S&P section above, we believe they bubble-wrap today’s move with a dovish rhetoric, one that shows caution on ground through the fourth quarter as trade headwinds pick up. In other words, we expect Gold and Treasuries to finish higher on the session and the Dollar lower. New Home Sales are at 9:00 am CT.

Technicals: Gold has slid back below the 1204 pivot this morning and furthermore, below the psychological $1200 mark. There is tremendous support below here and Gold has traded constructively against this level for over a month. This is not the time to panic, but instead when to hold strong and be on the lookout for a buy opportunity upon a quick spike to major three-star support at ... Please sign up for a a Free Trial at Blue Line Futures 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.

Visit our website at www.bluelinefutures.com to open an account and stay up to date with our research.

Bill Baruch is President and founder of Blue Line Futures. Bill has more than a decade of trading experience. Working with clients he focuses on developing trading strategies that present a clear objective for both long and short-term trading approaches. He believes that in order to properly execute a trading strategy, there must be a well-balanced approach to risk and reward.

Prior to Blue Line, Bill was the Chief Market Strategist at iiTRADER which followed running a trade desk at Lind Waldock and MF Global.

Bill is a featured expert on CNBC, Bloomberg and the Wall Street Journal as well as other top tier publications. 

Blue Line Futures is a leading futures and commodities brokerage firm located at the Chicago Board of Trade. We work with clients that range from institutional to professional to novice and from self-directed to broker-assisted. No matter what type of trader you are, our mission is simple; to put the client first. This means bringing YOU strong customer service, consistent and reliable research and state of the art technology. 

Information posted on IBKR Traders’ Insight that is provided by third-parties and not by Interactive Brokers does NOT constitute a recommendation by Interactive Brokers that you should contract for the services of that third party. Third-party participants who contribute to IBKR Traders’ Insight are independent of Interactive Brokers and Interactive Brokers does not make any representations or warranties concerning the services offered, their past or future performance, or the accuracy of the information provided by the third party. Past performance is no guarantee of future results.

This material is from Blue Line Futures and is being posted with Blue Line Futures’ permission. The views expressed in this material are solely those of the author and/or Blue Line Futures and IBKR is not endorsing or recommending any investment or trading discussed in this material. This material is for information only and is not and should not be construed as an offer to sell or the solicitation of an offer to buy any security. To the extent that this material discusses general market activity, industry or sector trends or other broad-based economic or political conditions, it should not be construed as research or investment advice. To the extent that it includes references to specific securities, commodities, currencies, or other instruments, those references do not constitute a recommendation by IBKR to buy, sell or hold such security. This material does not and is not intended to take into account the particular financial conditions, investment objectives or requirements of individual customers. Before acting on this material, you should consider whether it is suitable for your particular circumstances and, as necessary, seek professional advice.


20577




Stocks

Finimize - Beep, Beep, BMW


What's going on here?

Quintessential German carmaker BMW said on Tuesday that it wouldn’t make it to the finish line this year, lowering its own forecasts for how much profit it expects to make. Its shares decelerated 5%.

 

What does this mean?

In its car business, BMW said that it now expects profit margins of 7% (i.e. for every $100 of sales, it’ll keep $7 in the trunk) – down from its previous forecast of at least 8-10%. The carmaker cited the ongoing back and forth between the US and China over trade (it’s one of the biggest exporters of cars to China from the US). And Chinese customers holding off on luxury car purchases to wait for a lower tax rate probably didn’t help either. Higher costs were also to blame, thanks to BMW having to splash out on getting its engines in order ahead of the new European emissions regulations (WLTP) that rolled in this month.

 

Why should I care?

For markets: The trade war packs a punch.

Daimler (which makes Mercedes-Benz, among other things) lowered its profit expectations in June, and auto supplier Continental did the same in August. Both are expecting to be hurt by import taxes (a.k.a. tariffs) imposed on cars and car parts moving between China and the US. Investors and companies alike were hoping that cool heads would prevail as both countries planned a return to the negotiating table. But those talks were called off last week – making even higher tariffs likely in January 2019 as a result of yet another round of tit for tat.

The bigger picture: Everybody’s suffering.

BMW’s not alone. Between trade tensions and WLTP, European carmakers are skidding all over the show. Volkswagen – of “dieselgate” fame – only managed to get half of its models approved under WLTP, and Porsche has given up on diesel engines completely. Deep (and less polluted) breaths, everyone.

 

Originally Posted on Tue September 25, 2018

Finimize is the daily email that everyone in finance secretly reads. It's the perfect 3-minute cheat sheet on what happened in the financial news: it's free and without any jargon or as Forbes puts it “Super digestible and well-written. A+”. All content is created by the Finimize team, formerly @Goldman Sachs, Barclays, etc. Join more than 200,000 daily readers.

Information posted on IBKR Traders’ Insight that is provided by third-parties and not by Interactive Brokers does NOT constitute a recommendation by Interactive Brokers that you should contract for the services of that third party. Third-party participants who contribute to IBKR Traders’ Insight are independent of Interactive Brokers and Interactive Brokers does not make any representations or warranties concerning the services offered, their past or future performance, or the accuracy of the information provided by the third party. Past performance is no guarantee of future results.

This material is from Finimize and is being posted with Finimize's permission. The views expressed in this material are solely those of the author and/or Finimize and IBKR is not endorsing or recommending any investment or trading discussed in the material. This material is not and should not be construed as an offer to sell or the solicitation of an offer to buy any security. To the extent that this material discusses general market activity, industry or sector trends or other broad based economic or political conditions, it should not be construed as research or investment advice. To the extent that it includes references to specific securities, commodities, currencies, or other instruments, those references do not constitute a recommendation to buy, sell or hold such security. This material does not and is not intended to take into account the particular financial conditions, investment objectives or requirements of individual customers. Before acting on this material, you should consider whether it is suitable for your particular circumstances and, as necessary, seek professional advice.


20580




Macro

Briefing.com - Waiting on the Federal Reserve's Brush Strokes


The S&P futures are up four points and are trading 0.2% above fair value.  The Nasdaq 100 futures are up 14 points and are trading 0.2% above fair value.  The Dow Jones Industrial Average futures are up 18 points and are trading 0.1% above fair value.

That's a bland introduction to today's note, primarily because there isn't a lot of color in the brush strokes that have painted that slightly positive bias.

The trading picture, however, is going to get more vivid later today when the Federal Reserve releases an updated policy directive at 2:00 p.m. ET along with updated economic and policy rate projections. A press conference to explain the Fed's thinking will follow at 2:30 p.m. ET and will be governed by Fed Chairman Powell.

With respect to the directive, it is expected to include an indication that the Federal Open Market Committee (FOMC) voted unanimously to raise the target range for the fed funds rate from 1.75% to 2.00% to 2.00% to 2.25%.

The directive seems certain to highlight the improvement in the economy and the tightening in the labor market.  What is uncertain is whether the directive will continue to describe the policy stance as "accommodative," whether there is a nod to the risk of trade protectionism, and whether the policy rate projections feature an expectation for more rate hikes than the market currently expects.

To this point, the stock market has adopted the favorable line that rising policy rates are a reflection of a stronger economy, which is good for corporate earnings.  There is no telling right now, though, how the market will react to the totality of today's monetary policy decision and outlook.

You'll know it when you see it, which is why any trading action leading up to the FOMC affair should be taken lightly and understood to be subject to meaningful change -- either good or bad.

For the time being, there is some earnings news to distract the market.  Nike (NKE), KB Home (KBH), CarMax (KMX), and Cintas (CTAS) all reported their latest quarterly results. 

The responses have been mixed and it is Dow component Nike that has drawn the most media attention.  That's understandable given Nike's brand power, yet is borne mostly from the understanding that Nike is down 2.4% following its report.

The initial reaction has been deemed by some analysts to be a sell-the-news response given that Nike had been rallying ahead of its report, topped consensus estimates, and maintained its full-year outlook.  One blemish reportedly is that the company's gross margins were a little light of expectations.

Nike's weakness, though, is expected to be offset by IBM (IBM), which is up 1.7% in pre-market action after UBS upgraded the stock to Buy from Neutral.

Separately, things remain restless on the trade front.  There are no new developments between the U.S. and China, but it is being reported that the U.S. will push for a Mexico trade deal only if a NAFTA deal with Canada isn't reached in the next few days.

Today's featured economic release is the New Home Sales Report for August (Briefing.com consensus 630,000; Prior 627,000).  That report will be released at 10:00 a.m. ET.  It could provide a trading catalyst, but it won't complete today's trading picture, which is waiting to be filled in with the views of the Federal Reserve. 

--Patrick J. O'Hare, Briefing.com

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Information posted on IBKR Traders’ Insight that is provided by third-parties and not by Interactive Brokers does NOT constitute a recommendation by Interactive Brokers that you should contract for the services of that third party. Third-party participants who contribute to IBKR Traders’ Insight are independent of Interactive Brokers and Interactive Brokers does not make any representations or warranties concerning the services offered, their past or future performance, or the accuracy of the information provided by the third party. Past performance is no guarantee of future results.

This material is from Briefing.com and is being posted with Briefing.com's permission. The views expressed in this material are solely those of the author and/or Briefing.com and IBKR is not endorsing or recommending any investment or trading discussed in the material. This material is for information only and is not and should not be construed as an offer to sell or the solicitation of an offer to buy any security. To the extent that this material discusses general market activity, industry or sector trends or other broad-based economic or political conditions, it should not be construed as research or investment advice. To the extent that it includes references to specific securities, commodities, currencies, or other instruments, those references do not constitute a recommendation by IBKR to buy, sell or hold such security. This material does not and is not intended to take into account the particular financial conditions, investment objectives or requirements of individual customers. Before acting on this material, you should consider whether it is suitable for your particular circumstances and, as necessary, seek professional advice.


20579




Stocks

Benzinga - Morgan Stanley Says Buys The Nike Dip - By Elizabeth Balboa


Nike Inc NKE sold off Tuesday evening after posting first-quarter top- and bottom-line beats. Some experts are profiting on the pullback.

 

The Rating

Morgan Stanley analysts Lauren Cassel and Kimberly Greenberger maintained an Overweight rating on Nike and raised their price target from $88 to $103.

 

The Thesis

Digital sales accelerated in North America even as store comps marked higher traffic and improved conversion. At the same time, China sales grew 20 percent on 40-percent digital growth.

“Sportswear, running, basketball and Jordan all delivered impressive growth during the quarter and NKE is seeing no signs of a China slowdown with continued business momentum and demand for the brand,” Cassel and Greenberger wrote in a note.

The analysts acknowledged “unprecedented demand” for Nike’s premium footwear through the SNKRS app and expect continued expansion with upcoming app launches in Mexico, Brazil and Southeast Asia. Healthy inventories across all geographic markets positions the firm for strong second-quarter gross margins.

Nike’s flow-through rate, which increased from 9 percent to 26 percent quarter-over-quarter, yields similarly positive expectations.

“This highlights the margin benefit and future earnings power of NKE's direct to consumer transformation, in our view, and is a positive outlier in the sea of profitless growth we've observed this earnings season,” the analysts wrote.

Driven by gross margin beats and cuts to selling, general and administrative expenses (SG&A), Nike expanded its earnings-before-interest-and-tax margin by 120 basis points. Notably, Morgan Stanley considers the metric “in early innings.”

The analysts anticipate first-half pressure from inflation in rubber and other input costs, but the headwind is expected to clear in the back half to compound a forex tailwind. Altogether, the factors should drive year-over-year gross-margin growth.

 

Price Action

At time of publication, shares were set to open down 2.6 percent at a rate of $82.62.

Latest Ratings for NKE

Date

Firm

Action

From

To

Sep 2018

Jefferies

Maintains

Hold

Hold

Sep 2018

Macquarie

Maintains

Outperform

Outperform

Sep 2018

Deutsche Bank

Maintains

Buy

Buy


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© 2018 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.

Benzinga is a fast-growing financial media outlet that empowers investors with market-moving content. The site also manages Benzinga Pro, a streaming platform with real-time headlines, data and actionable alerts. Sign up for a free trial and profit with faster news now.

Information posted on IBKR Traders’ Insight that is provided by third-parties and not by Interactive Brokers does NOT constitute a recommendation by Interactive Brokers that you should contract for the services of that third party. Third-party participants who contribute to IBKR Traders’ Insight are independent of Interactive Brokers and Interactive Brokers does not make any representations or warranties concerning the services offered, their past or future performance, or the accuracy of the information provided by the third party. Past performance is no guarantee of future results.

This material is from Benzinga and is being posted with Benzinga's permission. The views expressed in this material are solely those of the author and/or Benzinga and IBKR is not endorsing or recommending any investment or trading discussed in the material. This material is not and should not be construed as an offer to sell or the solicitation of an offer to buy any security. To the extent that this material discusses general market activity, industry or sector trends or other broad based economic or political conditions, it should not be construed as research or investment advice. To the extent that it includes references to specific securities, commodities, currencies, or other instruments, those references do not constitute a recommendation to buy, sell or hold such security. This material does not and is not intended to take into account the particular financial conditions, investment objectives or requirements of individual customers. Before acting on this material, you should consider whether it is suitable for your particular circumstances and, as necessary, seek professional advice.


20578




Technical Analysis

FIBOCALL - The Morning FIBOCALL for 9/26/18


SPX

On Friday 9/21, the SPX made a new intraday high @ 2940.91 and closed down on the day.
The SPX has now closed lower for 3 days in a row, as it came very close to a long term overbought condition.

On 9/14, the SPX came very close to a long term overbought condition and had a pullback to test the 20 DMA and HELD.

Our bounce zone @ 2902.52-2893.45 with the 20 DMA @ 2900.44 inside the zone.
The SPX has our long term overshoot level  @ 2953.15 with our year-end target @ 3002.82 (LT 1.382 level) above.
The long term trend is still higher

No long term condition here at this time.

 

XLF

The XLF top ticked @ 29.07 on 9/20.

XLF closed below our short term bounce zone @ 28.52-28.39
and the 20 DMA @ 28.40
Support below:

50 DMA @ 28.19
200 DMA @ 28.10 must hold for the bulls.

Long term we are looking for higher
The LT .764 level @ 29.37 with the 1/29 high @ 30.32 above.
No long term signal here at this time.

 

10 year note yields

Yields are due for a short term pullback.

Long term overbought is in place.

Our first short term support @ 3.030, 2.988 and the 20 DMA @ 2.978

We have projected yield levels above:
@ 3.106, 3.129 , 3.158 , 3.204 and 3.25

 

IWM

The IWM has 2 zones to know:
Our long term bounce zone @ 169.27-168.29 with the 50 DMA @ 169.19 inside the zone.
20 DMA @ 171.02 with our short term selling zone @ 171.23-171.74 that was tested last week.
A close above 171.74 would be bullish and can add to longs.

Look to trade the zones until that trend ends.
No long term signal here.

 

NASDAQ futures (new contract)
The NZQ bottom ticked on 9/7 low @ 7420.50
Closed above the 20 DMA @ 7570.

Trading inside our Short term selling zone @ 7572-7607.75 NOW.
A close above 7608 would be bullish

The .764 level @ 7652, and the 8/30 high @ 7723.50 are above

No long term signal here at this time.

 

CRUDE

Crude is trading ABOVE our Selling zone @ 69.85-71.13 after flirting inside last few weeks.

The LT .764 level @ 72.71 has been a struggle to close above so far.
The 7/3 high @ 75.27 above.
With our long term selling zone 66.89-76.53 is here and a sideways move inside this zone is BULLISH.
Our very long term selling zone @ 86.66-100.96

Crude has the 20 DMA @ 69.80 and the 50 DMA @ 68.77 is support below.

No long term signal here.

 

FIBOCRYPTOCALL

XBTUSD (Bitcoin)

A possible short term bounce can come to test the 20 DMA @ 6595 with

our short term selling zone @ 6757-6911 with the 50 DMA @ 6872  inside the zone.
Some short term support levels to look for LOWER are the 9/19 low @ 6108 ,

and the 8/14 low @ 5887.
Longer term has the June 2018 low @ 5791
No long term oversold yet.

 

SPX-cash daily chart

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TRADING IN BITCOIN FUTURES IS ESPECIALLY RISKY AND IS ONLY FOR CLIENTS WITH A HIGH RISK TOLERANCE AND THE FINANCIAL ABILITY TO SUSTAIN LOSSES. More information about the risk of trading Bitcoin products can be found on the IBKR website. If you’re new to bitcoin, or futures in general, download The Beginners Guide to Bitcoin Futures.

A member of the Market Technicians Association since 1987, Gary Berman provides institutional clients Technical Analysis Research. He is also an author for the REAL MONEY PRO section of TheStreet.com and TalkMarkets.

At THE FIBOCALL we focus on bringing you ACTIONABLE technical analysis research on a daily basis. Everyone should use THE FIBOCALL as a complementary tool to fundamental analysis – a cross check if you will. Our research can be applied on a macro or micro basis. THE FIBOCALL LLC provides custom technical analysis research on equities, ETFs, fixed income and commodities daily. In the electronic world it’s not enough to know the fundamental story on individual equities. You need to know when technicals confirm what the fundamentals say.

Please feel free to ask any questions you may have regarding THE FIBOCALL LLC. We offer a 2 week free trial offer so you can determine just how value added THE FIBOCALL can be to you.

Information posted on IBKR Traders’ Insight that is provided by third-parties and not by Interactive Brokers does NOT constitute a recommendation by Interactive Brokers that you should contract for the services of that third party. Third-party participants who contribute to IBKR Traders’ Insight are independent of Interactive Brokers and Interactive Brokers does not make any representations or warranties concerning the services offered, their past or future performance, or the accuracy of the information provided by the third party. Past performance is no guarantee of future results.

This material is from THE FIBOCALL and is being posted with THE FIBOCALL’s permission. The views expressed in this material are solely those of the author and/or THE FIBOCALL and IBKR is not endorsing or recommending any investment or trading discussed in the material. This material is not and should not be construed as an offer to sell or the solicitation of an offer to buy any security. To the extent that this material discusses general market activity, industry or sector trends or other broad based economic or political conditions, it should not be construed as research or investment advice. To the extent that it includes references to specific securities, commodities, currencies, or other instruments, those references do not constitute a recommendation to buy, sell or hold such security. This material does not and is not intended to take into account the particular financial conditions, investment objectives or requirements of individual customers. Before acting on this material, you should consider whether it is suitable for your particular circumstances and, as necessary, seek professional advice.


20576




1 2 3 4 5 2 1561

Disclosures

We appreciate your feedback. If you have any questions or comments about IB Traders' Insight please contact ibti@ibkr.com.

The material (including articles and commentary) provided on IB Traders' Insight is offered for informational purposes only. The posted material is NOT a recommendation by Interactive Brokers (IB) that you or your clients should contract for the services of or invest with any of the independent advisors or hedge funds or others who may post on IB Traders' Insight or invest with any advisors or hedge funds. The advisors, hedge funds and other analysts who may post on IB Traders' Insight are independent of IB and IB does not make any representations or warranties concerning the past or future performance of these advisors, hedge funds and others or the accuracy of the information they provide. Interactive Brokers does not conduct a "suitability review" to make sure the trading of any advisor or hedge fund or other party is suitable for you.

Securities or other financial instruments mentioned in the material posted are not suitable for all investors. The material posted does not take into account your particular investment objectives, financial situations or needs and is not intended as a recommendation to you of any particular securities, financial instruments or strategies. Before making any investment or trade, you should consider whether it is suitable for your particular circumstances and, as necessary, seek professional advice. Past performance is no guarantee of future results.

Any information provided by third parties has been obtained from sources believed to be reliable and accurate; however, IB does not warrant its accuracy and assumes no responsibility for any errors or omissions.

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