OP Wire 9/30 (OP – Lite)

US stock futures remained steady as investors await key events this week, including Federal Reserve Chair Jerome Powell’s speech on Monday and new data from the jobs market.

The Dow Jones Industrial Average recently reached a new all-time high, supported by a report from the Commerce Department that hinted at easing inflationary pressures and moderate consumer spending growth. This has fueled speculation that the Fed might implement another significant 50-basis-point rate cut at its next meeting, as indicated by the CME Group’s FedWatch Tool. Earlier this month, the Fed made a 50-basis-point cut due to signs of reduced price pressure and a softer labor market.

Traders are now focused on Powell’s upcoming speech at the National Association for Business Economics annual meeting in Tennessee at 13:55 ET, which could provide more insight into the economic outlook.

Jobs Report in Focus

The upcoming US nonfarm payrolls report is also a major highlight on this week’s economic calendar. Analysts expect the economy to add 144,000 jobs in September, slightly up from 142,000 in August, with the unemployment rate remaining steady at 4.2%. August’s figures showed payrolls rising from a downward revision of 89,000, which missed expectations of 164,000, further signaling a slowdown in labor demand.

The labor market’s performance will likely shape the Fed’s next steps. ING analysts noted that job data could be the “key to the pace” of future rate cuts, especially as inflation appears to be cooling. A weaker payroll number or an increase in the unemployment rate could intensify calls for another 50-basis-point rate cut.

California Governor Vetoes AI Regulation Bill

In other news, California Governor Gavin Newsom vetoed a proposed bill that sought to introduce strict regulations on artificial intelligence development. The bill would have required safety testing for AI models costing over $100 million and mandated a “kill switch” for shutting down AI systems.

While intended to protect the public, the bill faced opposition from tech giants like Meta and OpenAI, who argued it would hinder innovation. In his veto, Newsom emphasized that 32 of the world’s most critical AI firms are based in California and warned the bill could stifle the state’s tech leadership.

Chinese Manufacturing Slows in September

China’s manufacturing sector showed signs of contraction in September, though the data slightly exceeded economists’ expectations. The official manufacturing PMI came in at 49.8, up from 49.1 in August, but still below the 50-point threshold that indicates expansion. Similarly, the Caixin manufacturing PMI slipped to 49.3, down from 50.4 in the previous month.

Despite the dip, China’s recent stimulus measures could provide short-term support, helping lawmakers in Beijing work toward their goal of 5% annual growth.

Oil Prices Rise Amid Middle East Tensions

Oil prices saw an uptick on Monday as tensions in the Middle East escalated. Brent crude climbed 0.9% to $72.20 per barrel, while US crude (WTI) rose 0.8% to $68.71 a barrel. The increases follow Israel’s intensified military actions against Iranian-backed Hezbollah and Houthi militants, which has heightened concerns of a broader conflict in the region.

Last week, oil prices dipped as China’s stimulus efforts failed to fully restore market confidence amid ongoing concerns about demand from the world’s largest oil importer.

Here are yesterdays PYT tickers

BA-

ER 10/30

EPS -$5.62

Bearish all terms 

All indicators bearish currently 

BABA-

ER 11/14

PE 27

China manufacturing improvement will gap it up.

All terms are Bullish

All Indicators currently Bullish 

NVDA-

ER 11/27

PE 57

Short term and mid term bullish 

$118.50 Support/ $130 Resistance 

All indicators bullish currently 

AMD-

ER 10/29

PE 197 🤔

Neutral 

$161 Support/ $171 Resistance 

All indicators flashing bullish 

AAPL-

ER 10/31

PE 34

Short and Mid Terms Bullish

$224 Support / $230.50 Resistance 

All indicators currently flashing bullish 

DOCU-

ER 12/5

PE 13

Neutral but indicators starting to flash bullish 

SPY/SPX – Last week we stated how price trades versus the 20,250 level of interest, which marked the lower high from mid-August. Given how large the move was last time price tested this area, this is a significant level on all timeframes. Buyers will be looking for a continuation move through this key area of resistance. If they are successful, price can target 20500, 20800, and 21000.” 

Buyers were successful in continuing the bullish activity with a move that tested the 20500 upside weekly level. That being said, it was quite an uneventful week with low volume and volatility across the board.

Given that price is still trading near the key weekly timeframe pivot at 20,255, the main watch for this week will remain the same. If buyers can now defend the 20,255 pivot, price can target 20500, 20800, and 21000. If weakness is seen below 20,255 and more sellers step in, price can target 19850, 19550, 19250, and 19000.

Upside levels of interest: 20500, 20800, 21000

Downside levels of interest: 20255, 19850, 19550, 19250

Notable Economic Data

  • Monday – Powell Speech
  • Tuesday: ISM Manufacturing PMI
  • Wednesday: ADP Non-Farm Employment Change
  • Thursday: Jobless Claims
  • Friday: Non-Farm Payrolls

Another perfect week last week… can we be perfect again this week? We shall see!

Today I’ll be playing the WMT puts again while looking for a BABA put scalp to set up as my major lines of $110 and $115 are good opportunities. See you all in chat!

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If you want to get the plays of the day then signup for Gold, and get a FREE TRIAL

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