FOMC member Waller’s comments on inflation sends metals and stock indices higher. Consumer Confidence comes in higher than expectations, and crude finds support.
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Good afternoon, traders. It’s Chris Chavez with the Blue Line Futures and it’s your daily midday market minute. We’re seeing a rally in treasuries which is fueling a broad based risk asset rally. But before we get to it, if we’re watching this video, like it subscribe if you’re on our website, there is also a link to direct you to YouTube and you can subscribe that way.
We would love for you to follow us. We would love for you to help us build our following. So yeah, we got a Fed member, Waller, and he was speaking today. As he was speaking, he made an important comment. He said it inflation. If it’s consistently coming in and consistently declining, that there’s no need for the Fed to sustain reasonably high interest rates.
So we’re looking at the CME Fed watch tool, you know, before and after Fed Waller, you know, made this comment and we could see that in the month of May, we saw interest rate cut expectations move up from 52% to 63% when looking at the month of June. We saw those cut expectation move up from 75% to 82%.
So, you know, it’s looking like, you know, the bond markets believing that, you know, the Fed’s going to be cutting sooner than expected. You know, as we got those comments from from Waller, we did see a little bit of a pop, you know, when looking at the Nasdaq, some of the other stock indices, precious metals are sharply higher here today.
Crude is catching a nice bit as well. And Treasury yields are lower off of the rally that we’re seeing across the Treasury curve. So we’re going to want to continue to pay attention to, you know, this Fed talk that we’re getting, the data that we’re going to continue to see this week, you know, non-farm. We’re also going to get a seven year note auction here today.
So definitely still something that can influence yields, you know, rates. And, you know, the landscape as a whole and looking at, you know, equities, you know, equity markets, you know, the S&P major three star resistance is going to be 45, 67 to 45, 70. Nasdaq not as significant, but still an important level. You’re going to want to keep an eye on that.
We highlighted in our research, two star resistance is going to be 1647 to 1653 gold. We’re seeing a real nice pop here. And you know the market, we did just get the roll from December to February. So major three star resistance is going to be 2047 to 2052. We’re just above that as as I’m shooting this video right now.
So we’re going to want to see a break in close above that level, too, to see more momentum in crude oil, 76, 85 to 77. Well, that’s major three star resistance that to pay attention to in the markets here moving forward certainly yields the consumer will be an important one. We did get consumer confidence this morning that came in slightly above estimates.
Could be one reason, again, why you’re kind of seeing crude. You know, bounce a little bit today as well. If you have any questions, reach out to our trade desk. We’re here for you. Remember, futures trading involves substantial risk of loss and is not suitable for all investors.
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