Good morning, everyone, and welcome to a new week. There are fifteen trading days left this quarter.
I got a knot in my stomach on Friday evening when the big news came out about some kind of breakthrough deal with Mexico. It was on my mind all weekend, and I was wondering if we’d gap up 70 points on the ES. We did indeed gap up, and powerfully, but we’ve been in “digestion” mode since then.
Indeed, as I’m typing this, the ES, NQ, and YM are all up about half a single percentage point. Green, yes, but hardly the soul-destroying explosion I was worried about. Viewed in a longer-term context, the jury is still out. It’s actually kind of a relief that this Mexico nonsense is out of the way, because we can see how the market judges the “best case” scenario with this particular trading partner.
With this little conjured distraction out of the way, however, attention will return to something of far more substance and complexity, which is China. Word on the street is that the Xi/Trump talk later this month at G20 (Osaka) is the thing to watch. My guess is that the word of the day will be “disappointment”, but I’m sure the market will wring every point it can out of the nauseating Trade Talk Optimism we’ve been living with for too many months now.
As for this week, all the events are note come later.