J&J bars the way [Video]
|US Dollar: Dec '20 USD Down at 91.790.
Energies: Apr'21 Crude is Up at 61.19.
Financials: The June '21 30 year bond is Down 5 ticks and trading at 157.00.
Indices: The June'21 S&P 500 emini ES contract is 22 ticks Higher and trading at 4138.25.
Gold: The June'21 Gold contract is trading Down at 1742.40. Gold is 52 ticks Lower than its close.
Initial Conclusion
This is not a correlated market. The dollar is Down- and Crude is Up+ which is normal and the 30 year Bond is trading Lower. The Financials should always correlate with the US dollar such that if the dollar is lower then bonds should follow and vice-versa. The S&P is Higher and Crude is trading Higher which is not correlated. Gold is trading Lower which is not correlated with the US dollar trading Lower. I tend to believe that Gold has an inverse relationship with the US Dollar as when the US Dollar is down, Gold tends to rise in value and vice-versa. Think of it as a seesaw, when one is up the other should be down. I point this out to you to make you aware that when we don't have a correlated market, it means something is wrong. As traders you need to be aware of this and proceed with your eyes wide open. Asia is trading mainly Higher with the exception of the Singapore and Nikkei exchange. Currently Europe is trading Higher with the exception of the Milan exchange which is down fractionally.
Possible challenges to traders today
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Import Prices are out at 8:30 AM EST. This is Major.
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Crude Oil Inventories is out at 10:30 AM EST. This is Major.
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Fed Chair Powell Speaks at 12 noon EST. This is Major.
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Beige Book is out at 2 PM EST. This is Major.
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FOMC Member Williams Speaks at 2:30 PM EST. This is Major.
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FOMC Member Clarida Speaks at 3:45 PM EST. This is Major.
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FOMC Member Bostic Speaks at 4 PM EST. No effect.
Bias
Yesterday we gave the markets an Upside bias as the USD, Bonds and Gold were all trading Lower yesterday morning and under ordinary circumstances would have been an Upside day. The S&P and Nasdaq did trade Higher however the Dow dropped 68 points. Today we aren't dealing with a correlated market and our bias is to the Upside.
Could this change? Of Course. Remember anything can happen in a volatile market.
Commentary
Yesterday we gave the markets an Upside bias as just about all the instruments we use for Market Correlation purposes indicated an Upside day. Then a funny thing happened around 7 AM EST. It was announced that the JNJ vaccine that only requires one dose was put on hold as some people developed blood clots in their brain allegedly due to this vaccine. However it should be understand that about 7 million JNJ vaccines were administered and out of those only six (6) persons were affected this way. That is minuscule and those persons were women ages 18-48. No women outside of that age range have been affected. This drove the Dow lower and as such the Dow was the only index to lose ground yesterday. Both the S&P and Nasdaq gained ground. Today we have a bit more economic news so we shall see if this changes market direction today.
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