Patriots day doesn’t advance markets [Video]
|US Dollar: Jun '21 USD Down at 90.950.
Energies: Jun'21 Crude is Up at 64.19.
Financials: The June '21 30 year bond is Down 15 ticks and trading at 157.01.
Indices: The June'21 S&P 500 emini ES contract is 8 ticks Lower and trading at 4153.50.
Gold: The June'21 Gold contract is trading Down at 1766.80. Gold is 48 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 Lower and Crude is trading Higher which is 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 Lower with the exception of the Indian Sensex and Hang Seng exchanges which are Higher at this time. Currently all of Europe is trading Lower.
Possible challenges to traders today
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No Major economic news to speak of.
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Lack of Major economic news.
Bias
Yesterday we gave the markets a Neutral bias as there was no correlation between the USD and the Bonds. Unlike Friday where the markets traded Higher, yesterday the Dow fell by 123 points and the other indices lost ground as well. Today we aren't dealing with a correlated market and our bias is Neutral.
Could this change? Of Course. Remember anything can happen in a volatile market.
Commentary
Yesterday represented Patriots Day in the US state of Massachusetts. No, we aren't referring to the New England Patriots football team, its is a state holiday as it refers to the start of the American Revolutionary war and specifically the battle of Lexington and Concord in 1775. Well that didn't help the markets yesterday as the Dow and the other indices fell. In truth there were other factors that contributed to this. The Derek Chauvin trial in Minnesota, the Wright shooting in Brooklyn Center MN, the Indianapolis shooting at a FedEx facility. Today as in yesterday we have no economic news to drive the markets one way or the other.
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