The markets here in the states were positive and initially staggered on Tuesday, with the SPX closing near 4246.44 and benefitting from the NDX record high, while cyclical and small cap momentum plays in DJIA and RUT were relatively slow but still green. NYSE internals were in neutral mode for most of the session, US treasuries were slightly positive and the DXY weaker as we go into the ES settle. SPX 4200 is still a pivotal area and if price stays above that level, 4225 is, like last week, a weekly point of contention. This is the area that bulls and bears would have it out if you throw them a headline or bit of data to chew on. Initial weekly resistance is pretty much where it was last week -- and we were there as we went into the cash close rallying on Fed Chair testimony on the hill.
Gold: The volume point of control for today's gold futures session is 1779. This volume coincides with time spent. Value is found from 1774.90 to 1779.90. You get the picture -- balancing, two-sided trade that should be referenced and taken in context of the preceding three sessions. We are balancing now in a narrowing trend for four sessions. VWAP was 1777. The settle for August delivery was about 1777.60, so you can see how magnetic the area has been.
The daily chart shows part of the four-session balance area runs from 1767.90 to 1791 but does not outline the session I'm paying most attention to in the first three charts below. The balance coincides with the bounce from 30 November of last year and is located on the initial retrace level above the August '20 to March '21 double bottom at 1673.30. That retrace is not important like the other halfway levels that we could not maintain, but it does seem to be a reference. As we watch the forming bracket, we wait to see how local trade happens within that consolidation area. In the case of gold, there are multiple crosscurrents to consider, so any break below or above must be viewed in the context of the DXY, the Treasury market, economic data and of course the gallery of Federal Reserve speakers making the rounds.
You might put the influence of intermeeting Fed-speak in the arbitrary category, alongside those conspiracy themes you will read about. Fed speakers could be seen as doing this good cop/bad cop thing sometimes. If they were to blurt out cheap and easy sentiment, it would seem like part of a broader societal trend that you can see in the manipulation of bitcoin by bored magnates on twitter -- those people who get a thrill from the power to influence. There is no practical way to lay the groundwork for the next Fed meeting by talking out of both sides of your mouth, but maybe they are assuming some net result. I can tell you they are not so fast with words in government work that involves acute risk to life and limb or irreparable consequences. These federal finance guys and girls should speak carefully and probably not say too much off-the-cuff. Money may only be money for some, but its mismanagement can damage innocent bystanders too. Wishing you a safe and happy day.
