Stocks Surge As Senate Trial Approaches

Posted Tuesday, January 14, 2020 by
Shain Vernier • 2 min read

At the midway point of the U.S. session, stocks are once again on the bull. The DJIA DOW (+125), S&P 500 SPX (+2), and NASDAQ (+13) have put in a solid session and new all-time highs. For the time being, it appears as though traders anticipate a quick Senatorial acquittal of President Trump on both articles of impeachment.

Late Monday afternoon, reports began hitting the newswires that the Senate’s trial of impeachment may begin as early as this week. Most political pundits expect U.S. House of Representatives Speaker Nancy Pelosi to turn the articles over to the Senate by Thursday. If so, the Senate may commence the trial by Friday’s Wall Street close.

Aside from heightened media buzz over Trump’s impeachment, this morning has brought the release of U.S. CPI for December. Here is a quick look at the highlights:

Event                                         Actual      Projected      Previous

CPI (YoY, Dec.)                           2.3%              2.3%               2.1%

Core CPI (YoY, Dec.)                 0.1%               0.2%             0.2%

This group of figures suggests that inflation came in relatively flat for December. Although CPI did hit projections, Core CPI underperformed. The discrepancy is largely a product of increased fuel prices and a surprise rally in WTI crude oil values. 

It seems that no matter what occurs in the news, U.S. stocks are on a freight train north. Let’s take a look at the March E-mini S&P 500 and see if there is a potential trading opportunity on the horizon.

Stocks Rally, March E-mini S&P 500 Futures Close In On 3,300

For the first time in quite a while, the March E-mini S&Ps are on the cusp of a big-round-number. At press time (about 1:00 PM EST), 3300.00 is in view. Will 3300.00 set up as viable topside resistance?

March E-mini S&P 500 Futures (ES), Daily Chart

Here are a few levels to watch as late-day trade unfolds:

  • Resistance(1): Psyche Level, 3300.00
  • Support(1): Bollinger MP, 3221.50
  • Support(2): Daily SMA, 3217.25

Bottom Line: Although today’s price action is positive across the board for U.S. stocks, we may be closing in on an area of resistance in the March E-mini S&Ps. Until elected, I will have sell orders queued up from 3298.75. With an initial stop at 3302.75, this trade produces 12 ticks profit on a short-term scalp from just beneath the 3300.00 handle.

Check out our free forex signals
Follow the top economic events on FX Leaders economic calendar
Trade better, discover more Forex Trading Strategies
Related Articles
0 0 vote
Article Rating
Notify of
Inline Feedbacks
View all comments