When US markets opened after Labor Day, WTIC started to better reflect the actual Mideast escalation – it didn‘t happen during the premarket session, but in the run up to the opening bell. Early buyers were overpowered, and stocks (incl. the leading tech, which was my focus for longs) did slide to a major support level around QQQ 717, which was the final and successful long intraday entry in tech allowing clients to recoup prior smaller whipsaws, walking off in a fine daily position overall.
More kinetic action then marked a bearish turning point once again before the closing bell – and yet again, Asian and European sessions didn‘t reflect that, VIX didn‘t reflect that – but oil did.
Tech lower timeframes (e.g. 5min) were showing a rounded top structure where it made msot sense for buyers to wait for price behaviour around said 707 area – and it was cut through like hot knife through butter as early morning, and remains below this level still.
Is that also part of the positioning for upcoming inflation data?
As talked yesterday with clients, I look for rather hot inflation data – first we get PPI, and there‘s little to make me think it would be tame, actually this will be a hotter figure than CPI itself – maybe the state of the consumer as seen in XLY, XRT and other sectors doesn‘t paint a picture of economy being able to accept high oil prices art the retail level, which makes both inflation readings to come spooky, each in itw own right.
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