Coverage for the week of July 24th – July 28th: In this week’s coverage, we analyze the rally in the E-Mini S&P 500 futures, a pullback in Euro FX and stalls in Natural Gas and Gold futures. We also examine the economic reports and earnings releases during FOMC announcement week.
September E-Mini S&P 500 Future Daily Chart
The September E-Mini S&P 500 failed to reach the 76.4% Fibonacci retracement level (as measured by the downtrend that started on January 5th, 2022, and ended on October 13, 2022). It finished the week with a small bullish candle, possibly in anticipation of next week’s FOMC news. The MACD shows a possible momentum change to the downside, though the magnitude does not show a lot of conviction to that change. The RSI crossed below the overbought level of 70, which can be seen as a bearish signal – more concerning is the divergence between E-Mini S&P price (increasing high peaks) and the RSI (weakening high peaks). Should the market continue the bull trend, possible resistance exists at the 76.4% Fib level (which happens to be the peak high from April of 2022) at ~4630. A downturn could find support at the 61.8 Fib level (~4428).
August Natural Gas Future Daily Chart
August Natural Gas futures crossed above the 50-day moving average and climbed outside the top of the Ichimoku cloud, both considered bullish moves. Extending the previous uptrend (from the beginning of June to the end of June) to last week’s low, Nat Gas finished the week by hitting resistance at the 38.2% Fibonacci extension level of 2.75. RSI moved higher in line with price to ~56.50, and the MACD crossed both the zero line and its signal line on Friday – indicating a bullish trend. Should the bullish trend pan out, resistance might be found at 2.83 and 2.91, which represent the 50% and 61.8% Fibonacci extension levels. Support might be found at the 50-day moving average and the top of the Ichimoku cloud, at ~2.60.
September Euro FX Future Daily Chart
September Euro FX pulled back last week after making a recent high of 1.13105, a level not seen since April 2022. The pullback brought Euro FX down to the 23.6% Fibonacci retracement level (as defined by the uptrend that started May 31, 2023 and ended July 18, 2023) at about 1.11580. The RSI showed a bearish signal by crossing below the 70 level, and the MACD indicator shows a pending bearish cross of its signal line. Should the downtrend continue, a near-term support level might be found at the 38.2% Fib level of the recent uptrend (~1.10770) while further support might exist at the top of the Ichimoku cloud, the 50-day moving average, and the 23.6% Fib level of the longer term uptrend (~1.09400). Resistance might be encountered at the recent high of 1.13105.
August Gold Future Daily Chart
August Copper futures showed bullish promise early last week with a cross of the 50-day moving average, but found resistance at the 38.2% retracement level before turning down and finding support at that same 50-day moving average. The RSI traded down to 57, reflecting price action. The MACD crossed above the zero line early last week, though the MACD Histogram turned down and is headed toward zero, which indicates that bullish momentum is slowing. Should gold continue to pull back, support might be found at the 23.6% Fib level (1948) and further at the 200-day moving average (~1920). Resistance might be seen at 2005, which has been an area of support and resistance since February, and just above the 50% Fib retracement level.
Companies Reporting Earnings July 24th – July 28th
|Monday, July 24th||Whirlpool Corp. (WHR): $3.80 EPS Estimate, $4.82B Revenue Estimate (AMC)
Crown Holdings, Inc. (CCK): $1.65 EPS Estimate, $3.46B Revenue Estimate (AMC)
|Tuesday, July 25th||Verizon Communications (VZ): $1.17 EPS Estimate, $33.38B Revenue Estimate (BMO) *
General Motors Corp. (GM): $1.65 EPS Estimate, $41.98B Revenue Estimate (BMO)
3M Company (MMM): $1.65 EPS Estimate, $7.89B Revenue Estimate (BMO) *
General Electric Co. (GE): $0.46 EPS Estimate, $15.01B Revenue Estimate (BMO)
Raytheon Technologies (RTX): $1.17 EPS Estimate, $17.68B Revenue Estimate (BMO)
Archer-Daniels-Midland Co. (ADM): $1.59 EPS Estimate, $25.95B Revenue Estimate (BMO)
Dow Chemical (DOW): $0.70 EPS Estimate, $11.27B Revenue Estimate (BMO) *
Microsoft Corp. (MSFT): $2.55 EPS Estimate, $55.44B Revenue Estimate (AMC) *
Alphabet Inc. (GOOGL): $1.32 EPS Estimate, $72.77B Revenue Estimate (AMC)
Visa Inc. (V): $2.11 EPS Estimate, $8.06B Revenue Estimate (AMC) *
|Wednesday, July 26th||AT&T Corp. (T): $0.60 EPS Estimate, $30.00B Revenue Estimate (BMO)
Boeing Co. (BA): ($0.99) EPS Estimate, $18.29B Revenue Estimate (BMO) *
Coca-Cola Company (KO): $0.72 EPS Estimate, $11.72B Revenue Estimate (BMO) *
Meta Platforms, Inc. (META): $2.87 EPS Estimate, $31.06B Revenue Estimate (AMC)
eBay, Inc. (EBAY): $0.76 EPS Estimate, $2.50B Revenue Estimate (AMC)
|Thursday, July 27th||McDonalds Corp. (MCD): $2.76 EPS Estimate, $6.23B Revenue Estimate (BMO) *
Southwest Airlines Co. (LUV): $1.08 EPS Estimate, $6.98B Revenue Estimate (BMO)
MasterCard Inc. (MA): $2.87 EPS Estimate, $6.18B Revenue Estimate (BMO)
Valero Energy Corp. (VLO): $5.08 EPS Estimate, $34.55B Revenue Estimate (BMO)
AbbVie Inc. (ABBV): $2.78 EPS Estimate, $13.50B Revenue Estimate (BMO)
Honeywell International (HON): $2.20 EPS Estimate, $9.18B Revenue Estimate (BMO) *
Shell plc (SHEL): $1.59 EPS Estimate, $60.52B Revenue Estimate (BMO)
Ford Motor Company (F): $0.48 EPS Estimate, $40.06B Revenue Estimate (AMC)
Intel Corp. (INTC): ($0.04) EPS Estimate, $12.08B Revenue Estimate (AMC) *
United States Steel Corp. (X): $1.86 EPS Estimate, $5.09B Revenue Estimate (AMC)
|Friday, July 28th||Exxon Mobil Corp. (XOM): $2.12 EPS Estimate, $81.10B Revenue Estimate (BMO)
Procter & Gamble Co. (PG): $1.32 EPS Estimate, $19.94B Revenue Estimate (BMO) *
Chevron Corporation (CVX): $3.06 EPS Estimate, $48.98B Revenue Estimate (BMO)
Colgate-Palmolive Co. (CL): $0.74 EPS Estimate, $4.68B Revenue Estimate (BMO)
* indicates that this company is in the Dow Jones Index
Commentary: More than one third of the Dow Jones companies report earnings this week, which could result in volatility in Dow futures outside of regular trading hours this week. Three of those companies (Verizon, 3M and Dow Chemical) report before market open on Tuesday. Two more (Boeing and Coca-Cola) before market open on Wednesday, and another two companies (McDonald’s and Honeywell) on Thursday morning.
After market close on Tuesday, tech giants Microsoft and Alphabet (formerly known as Google) report, which could move prices in S&P 500 and NASDAQ futures. These markets may also be moved by Meta Platforms (aka Facebook) and eBay reports after market on Wednesday. Oil companies report earnings on Thursday (Valero Energy and Shell) and Friday (Exxon Mobil and Chevron). These companies’ forward guidance could provide insight into the crude oil market with their 2023/2024 oil demand outlooks.
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