Mptrader Out Front: Tuesday March 24th, 2020... ES and April Gold...


   With the equity futures indices locked limit up this AM (+5%), backstopped by yesterday's unprecedented and gargantuan "QE unlimited" plan announced by the Fed, a potentially massive up-day is all teed up for the Congress and The Administration, only if the powers that be can come to an agreement to rescue the US economy and the beleaguered, anxious American people SOON! The sand in the hourglass is quickly running out before millions of the newly unemployed run out of cash to feed their families.

   Will our political leaders reach an agreement that enables both sides of the isle to take a victory lap, knocking the tee shot 350 yards down the middle of the fairway, or will they top the ball into the ruff, or whiff altogether in a display of dysfunctional partisanship?

   Clearly, the markets are betting on a long beautiful tee shot right down the middle of the fairway to cushion the impact of  pain and anxiety inflicted by the still spreading Coronavirus, which they hope also will initiate recovery and healing of our financial markets. 

   From the perspective of ES, it continues to circle Limit UP (+5%) as we await some news about a deal on the Rescue Legislation. My attached 4 hour chart puts today's upmove into scale in relation to the otherwise still dominant downtrend. To inflict some technical damage to the nearest-term portion of the downtrend, ES needs to climb and sustain above 2386, yesterday's post-Fed QE "Unlimited" high, then take out 2428.00, and thereafter, follow-through above 2500. If such strength emerges today, the we should expect ES to lock Limit UP at +13% later in the session, presumably in reaction to the Rescue Plan agreement.

   Unless and until ES climbs above 2428.00, it will remain in the grasp of the nearest term dominant downtrend, and as such, also vulnerable to another loop down to revisit what has become key support lodged between 2225 and 2175. Let's notice on my attached 15 Minute Chart that 2175 to 2225 is the zone within which the Fed announced its QE "Unlimited" plan, and when mega fund manager David Tepper indicated in a CNBC interview that he was "nibbling" on the long side of selective stocks in healthcare and technology. For any reason, if ES is unable to advance, and rolls over into a decline that slices beneath 2175, we should expect another bout of panicky, disappointed, long liquidation.

   Meanwhile, April Gold finally preformed like an inflation gauge in reaction to all of the money being thrown at the markets and the economy. In overnight and pre-market trading, April Gold was up as much as $130/ounce since yesterday close! My attached 4 hour chart shows the vertical assault from last Thursday's low at 1457.50 to today's high at 1698.00 (+17%). A sustained climb above 1700 will point considerably higher, which is viewable from the perspective of my attached Weekly Chart, and projects towards 2000 to 2200...


More in a few minutes...

3 24 ES 15 Min 745 GIF
3 24 ES 4 Hr 745 GIF
3 24 Apr Gold 4 hr 750 GIF
3 24 Weekly Gold Futures GIF
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