S&P, NQ Test Crucial Resistance Levels to Start the Week

E-mini S&P (December) / E-mini NQ (December)

S&P, last week’s close: Settled at 6696.50, up 36.75 on Friday and down 26.00 on the week

NQ, last week’s close: Settled at 24,726.75, up 97.50 on Friday and down 139.59 on the week

E-mini S&P and E-mini NQ rebounded on Friday, paring a large portion of the week’s losses, after Core PCE was in line with expectations. Not only was the Fed’s preferred inflation gauge favorable, but the final Michigan Consumer data for September also showed that 1-year inflation expectations ticked down to 4.7%, from 4.8%. Although Michigan Consumer Sentiment eroded, the Atlanta Fed GDPNow estimate for the current quarter improved to 3.9%, from 3.3%.

All seems to be rolling along, except that the government faces a shutdown on October 1st if a funding deal is not reached in Washington. According to Polymarket, there is about a 65% probability. A shutdown would delay the release of economic data, including Friday’s Nonfarm Payroll report, placing a larger emphasis on the private ADP survey on Wednesday morning.

Friday’s price action was resilient; although it remained rangebound after whipsawing on the PCE release, the strong close set the stage for what has consistently been a buoyant overnight session. Here we are, retesting the 6729.25-6731.50 resistance level in the E-mini S&P, and a move out above here today will open the door for more record highs. Similarly, the E-mini NQ is testing resistance at 24,895-24,899. As today’s session gets underway, our Pivot and point of balance in the E-mini S&P at 6722.25 will be crucial; this is the settlement mark from Witching Friday, and continued price action above here favors the bulls across all timeframes.