The Day Ahead: PM Edition 2024-07-17
Next up is ECB rate decision in the morning and Netflix earnings after the bell on Thursday
Bonds
ZB was up a bit on Wednesday but still under the highs back from June. I still like higher while above 119 ^29 in an attempt to push for 121^04 or 121^25.
Crude Oil
Pretty impressive move on Wednesday in CL as it recovers the recent drop. This is certainly the type of move that is to be expected in a (C) wave. The alternative is the low against 80.50 was a wave (IV) and now in (V) up. Probably too aggressive to fade unless there is a drop back under 83.15, even better under 82.05.
Dollar Index
DX remains under pressure but I’m now thinking we are seeing a 3-3-3 type formation for a larger degree wave two or b. At minor support now at 103.70 with more support at 103.16.
Euro
I have been wondering if I should move wave (ii or b) to the right away from the 2023 swing high and decided to do so. The whole corrective pattern is a large 3-3-3 where the current swing high is a candidate for the end of the last three. Bears need Euro under 1.0946 for early confirmation of a reversal and later under 1.0880 to really feel good about it.
Gold
Gold is on plan with a wave (IV) consolidation. Initial support was already tested at 2455.10 but expect the consolidation to become more complex before being completed.
S&P 500 Futures
Pretty dramatic move in the S&P 500 on Wednesday as it pushed to the low end of the range from last week. Is the high in? I’m not sure. I can see the S&P 500 trading in a range making in difficult to ascertain if it is a consolidation or a sloppy rounded top in development. I’m assuming the latter but in the short-term, I think it best to allow for a move up on Thursday to the other side of the range.
