RJO FuturesCast

Daily Futures Market News, Commentary, & Insight

Bull and Bear Market

Global Indices are about as “green” as it gets this morning….the US, Europe, and Asia all charging higher into Monday morning. We’re headed into the gauntlet of earnings season this week and we’re going to get a better look as to just how bad corporate cashflows and EPS likely were in Q220. My weekend reading also reminded me that US Corporations issued over $800B in new debt in Q2 2020 – trying to solve a leverage problem with more leverage? Blame the Fed, as increased liquidity not only enables the problem, but exacerbates it. Also, evidence of Corporate buybacks stalling out.

Covid-19 continued its acceleration over the weekend, with the WHO reporting 230K new cases and a record of 70K new cases in a single day here in the US.  Florida reported 15K new cases alone.

Dollar devalued by another 0.14% overnight, while gold and silver prices continue their upward march. Emerging market equities (EM performs well in a falling Dollar environment) are up 15% since the Dollar broke bad in May.

Oil -1.24% off news out of OPEC suggesting supply will likely INCREASE at months end.  OPEC initiated record production cuts in May, that were extended thru July of 9.7M bbls.  This is likely set to fall to 7.7M bbls by Aug. Truthfully, this is nothing new, this has been the plan all along. Side note: I’m getting interested in nat gas on the long side.

Volatility (VIX) – a bull market advance in the S&P 500 as never been able to sustain itself with the VIX north of 20. But of course, “maybe its different” this time. Volatility is a big part of what we do.  You must know the overall direction (trend) of an assets volatility component ( and not just the SP500) in order to get the “big stuff” right. We measure volatility not only in stocks, but Gold, Oil, and Treasuries. Anyhow, VIX north of 25.00 suggests we’re not out of the woods in terms of volatility in equities.

There’s a few markets moving to the edges this morning that we’re interested in….we’ll keep you updated throughout the session. Hint: Ags, Energy, and Stocks.

Feel free to reach out to John Caruso at jcaruso@rjofutures.com or 1-800-669-5354 if you’d like to get a 2 month free trial of our proprietary trade recommendations by email. 

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John Caruso

Senior Market Strategist
Follow John on Twitter @JCarusoRJO. John began his career at Wilshire Quinn Capital, a Wealth Management Firm based out of Los Angeles, California. Prior to becoming a broker he did some individual trading on his own, where he first began to study and interpret different market strategies and ideas. In 2006 John moved over to Lind-Waldock where he began to service clients as a professional broker. He joined RJO Futures in 2011.
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