U.S. Market Update & Outlook: Dollar Holler Hits Gold

Mark Newton

We are seeing some minor weakness in U.S. stock market futures while most of Europe and Asia are mixed.

US Treasuries are holding steady, while most of Europe has begun to rally and bounce back after yesterday’s bond weakness. So some spread widening continues.

The U.S. Dollar is still pressing higher, while the EURUSD has fallen below 1.1775 and still could trend down to 1.17.

Gold was hit hard yesterday and its right to hold off on buying too aggressively until there are more signs that the U.S. Dollar is peaking out. For now, I don’t think gold is a buy just yet.

Emerging Markets weakness is likely to continue a bit longer. There is quite a bit of currency weakness in the EM space, which needs to be watched carefully. Also worth watching the High Yield space and credit spreads in the days ahead.

The equity market trend looks to have turned lower. And while this might take some time to unwind, as Europe still trending higher, it’s probably a good idea to use bounces to take profits (for traders)… or hedge and take on a more defensive tactical view between now and June.

S&P 500 Futures

For today,  2698-2700 has importance on the downside. A move under yesterday’s lows likely brings about a move to 2682-3.  A move over 2715, would be a minor positive for today and could allow for more short-term upside.

s&p 500 futures chart fibonacci price support may 16

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Author has positions in mentioned securities at the time of publication. Any opinions expressed herein are solely those of the author, and do not in any way represent the views or opinions of any other person or entity.