US STOCKS: S&P(ESH6)-GDP Helps Stocks Extend, Looking To Break Higher

US Treasuries gained Friday following comments from Fed Reserve NY President Williams.  Williams said he sees room for another cut “in the near term” as labor conditions show signs of weakening, causing market sentiment to quickly shift and investors to boost wagers on a third straight quarter-point cut."

The US 10-Yr bond future (TYZ5) finished up +0-12+ at 113-08 Friday, above all major moving averages.  TYZ5 has given back some of those gains at the open in Asia and is down -02+ to 113-05+.  

• The 2-Yr finished -2.5bps lower at 3.51%
• The 5-Yr finished -2.4bps lower at 3.622%
• The 10-Yr finished -2bps lower at 4.065%
• The 30-Yr finished -1bps lower at 4.713%

Traders are now pricing in nearly two-thirds odds of a reduction on Dec. 10, compared to just over 30% probability just before Williams spoke, following his comments and the September jobs report showing rising unemployment.  Earlier in the week various Fed Speakers had presented a mixed view on December with many retaining a wait and see approach.  

• RES 3: 140.08 - High Jun 13  
• RES 2: 139.05 - High Aug 4 
• RES 1: 137.30 - High Sep 8 and key short-term resistance
• PRICE: 135.24 @ 16:12 GMT Nov 21
• SUP 1: 134.87 - 3.0% Lower Bollinger Band
• SUP 2: 134.56 - Low Nov 19 & Cycle Low
• SUP 3: 134.25 - 1.0% 10-dma envelope  

Prices traded to new pullback and cycle lows Thursday, weighed by the weaker currency and breach of support in futures prices. This affirms the firm downtrend that’s dominated prices since mid-September, and prices will need to challenge resistance before signaling any broader reversal. Key short-term resistance has been defined at 137.30, the Sep 8 high. 

The S&P(ESZ5) overnight range was 6525.00 - 6677.50, SPX closed +0.98%, Asia is currently trading around 6650. Some dovish Fed speak on Friday and some headlines that Trump is floating the idea of allowing Nvidia H200 chips sales to China managed a bounce to end the week for risk, albeit from lower levels. Lets see how risk starts the week but Crypto has had a good bounce over the weekend and has helped Equity futures open up positive, can this extend ? The Bulls will be hoping for the 6500 area to continue to hold but I remain wary because of last week's price action and suspect we will see sellers return toward the 6750/6800 area should we see it. This morning the futures have opened strongly, E-minis(S&P) +0.50%, NQZ5 +0.70%. 

• Technically the S&P is still in an uptrend while the support toward 6500 holds, but this rounded top together with last week's price action looks foreboding to me.
• Nick Timiraos posted an excerpt from Bessent's interview with CNBC in which he said, “Bessent: Inflation is up because of services, not goods. "If you look at the data, that imported goods, the inflation has actually been flat. Inflation is up because of the service economy and services. So that has nothing to do with tariffs."
• The S&P 500 Index Average True Range(ATR) for the last 10 Trading days: 123 Points

Fig 1: S&P 500 Index Daily Chart

Source: MNI - Market News/Bloomberg Finance L.P