Wake Up Call – The Day Ahead Jan 5, 2021

Welcome to 2022. Oil and stock markets in same pattern of value v growth as ADP drops. Oil higher overnight ahead of EIA and solid moves overseas. A live recap of what happened while we slept overnight and what lies ahead. We go through charts on the S&P 500, Nasdaq, Russell, Oil and Natural gas. Markets again have eyes on Rates, Open Interest Gamma levels on the S&P 500 and mega stocks like Apple and Tesla ahead of Fed Minutes.

  • Enjoy live commentary from Our Trading Room at youtube as the day wraps up – feel free to like and share

The markets:

  • S&P Futures vs Fair Value: +16.0
  • WTI futures up $0.57, to $77.75/bbl. ahead of EIA
  • Natural gas up -.047 at 3.864
  • Apple testing $179 after $3 trillion at $182.86
  • U.S. Treasuries yields higher calmer The 10-yr yield down two basis points to 1.65% while the 2-yr yield is up one basis point to 0.77%. The 10-yr yield could be on the verge of a breakout after being range-bound since the first quarter of last year. 
  • The ADP Employment Change report estimated 807,000 jobs were added to private-sector payrolls in December, which was nearly twice as many jobs as the consensus of 425,000. The increase in November was downwardly revised to 505,000 from 534,000. – Small businesses: +204K v +115K m/m – Medium businesses: +214K v +142K m/m – Large businesses: +389K v +277K m/m
  • 1 million Omicron cases in the US but the hope is that it will not strain hospitals and will lead to a faster herd immunity.
  • The U.S. Dollar Index down 0.1% to 96.13.
  • JPY is the strongest and the CAD is the weakest
  • Spot gold is up $3.28 or 0.18% at $1817.48
  • Spot silver is down three cents or -0.09% at $23.02
  • Bitcoin is trading sideways $46,402
  • Japan’s Nikkei: +0.1%
  • Hong Kong’s Hang Seng: -1.6%
  • China’s Shanghai Composite: -1.0%
  • India’s Sensex: +0.6%
  • South Korea’s Kospi: -1.2%
  • Australia’s ASX All Ordinaries: -0.3%.
  • German DAX +0.68% (+0.7% yesterday)
  • France’s CAC +0.5% (+1.3% yesterday)
  • UK’s FTSE 100 +0.1% (+1.5% yesterday)
  • Spain’s Ibex +0.1% (+0.6% yesterday)
  • Italy’s FTSE MIB +0.25% (+0.4% yesterday)

Visit Traders Market Weekly: Traders Market Weekly: Hello There 2022 – TRADERS COMMUNITY for the daily calendar

  • Data out Today:
    • ADP Employment Change report for December (consensus 425,000) at 8:15 a.m. ET
    • FOMC Minutes from the December meeting at 2:00 p.m. ET.
    • Preliminary IHS Markit Services PMI for December will be released at 9:45 a.m. ET.

Overnight Stories in Depth

  • India’s December Nikkei Services PMI 55.5 (expected 57.5; last 58.1)
  • Australia’s December ANZ Job Advertisements -5.5% m/m (last 9.9%)
  • Hong Kong’s December Manufacturing PMI 50.8 (last 52.6)
  • Eurozone’s December Services PMI 53.1 (expected 53.3; last 55.9)
  • Germany’s December Services PMI 48.7 (expected 48.4; last 52.7)
  • France’s December Services PMI 57.0 (expected 57.1; last 57.4) and December Consumer Confidence 100 (expected 97; last 98)
  • Italy’s December Services PMI 53.0 (expected 54.0; last 55.9)
  • Spain’s December Services PMI 55.8 (expected 57.5; last 59.8) and December Consumer Confidence 81.3 (last 84.6)

2021 sector performances

Energy (+47.4%) and real estate (+42.3%) up more than 40.0%, followed by the information technology sector (+34.0%) with a 34% gain. The utilities (+13.6%) and consumer staples (+14.7%) sectors are up less than 15.0% this year. 

Within the technology sector, Apple (AAPL 172.12, -0.08, unch) is up 34.3% this year, Microsoft (MSFT 338.85, -0.47, -0.1%) is up 52.6%, and NVIDIA (NVDA 297.00, +1.14, +0.4%) is up a whopping 126.6%. 

  • China’s December Manufacturing PMI 50.3 (expected 50.0; last 50.1) and December Non-Manufacturing PMI 52.7 (expected 52.0; last 52.3)
  • South Korea’s December CPI 0.2% m/m (expected 0.1%; last 0.4%); 3.7% yr/yr (expected 3.6%; last 3.7%)

New York Fed Index Shows Global Supply Chain Pressures May Have Peaked – TRADERS COMMUNITY

The New York Federal Reserve released a new Index, The Global Supply Chain Pressure Index (GSCPI). The NY Fed concluded that global supply chain pressures may have peaked and might start to moderate somewhat going forward. The index uses 27 variables that are meant to capture factors that put pressure on the global supply chain, both domestically and internationally.

Around The Barrel – Crude Oil and Gasoline Outlook for 2022 – TRADERS COMMUNITY

Welcome to 2022, WTI Oil futures have rallied after OPEC+ holds the status quo. Last week EIA reported US Crude last Week crude drew -3576Kbbl (incl +1055kbbl build at Cushing). Gasoline stocks drew -1458kbbl. Utilization fell -.2% to 89.6%. Production +200k to 11,800 kbpd.

Into The Vortex – Natural Gas Outlook – TRADERS COMMUNITY

Into New Year and U.S. domestic natural gas demand for heating has weakened   Atmospheric G2 models said that warmer-than-normal temperatures in the eastern U.S. should continue to curb heating demand.  Last week EIA reported a draw of -136 Bcf of working gas in storage lower than expected. With the global energy crisis LNG exports continue to grow but we balance supply shortages with deliverability.

Earnings Calendar for Today

Any questions please feel free to ask them below. Trade Smart!

Have a great trading day!


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2 thoughts on “Wake Up Call – The Day Ahead Jan 5, 2021”

  1. TradersCom says:

    German DAX, +0.7%
    France’s CAC, +0.9%
    UK’s FTSE 100 +0.2%
    Spain’s Ibex unchanged
    Italy’s FTSE MIB, +0.7%

    3 days for rises o/t Spain for 2022

  2. TradersCom says:

    Meanwhile same pattern stateside:

    Dow industrial average up 79.2 points or 0.21% at 36877.23.
    S&P index down 10 points or -0.22% at 4783.13
    NASDAQ index down -148 points or -0.95% 15473.42.

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