OIL: Trump Announces Venezuelan Oil Flows To US Driving Prices Down Sharply

The Nikkei(NHH6) contract Friday night range was 50460 - 50880, Asia is currently trading 50730, +0.05%. The (NHH6) contract consolidated its gains to end the week on Friday. The Nikkei 225 technically remains in an uptrend while the support toward 48000 holds, albeit a very steep one. In the Asian session price data has seen price stall and fall back below the 50800 area, failure to push above here and we could see a pullback towards first support around 49600-900.

• "JAPAN 3Q GDP -2.3% ON ANNUALIZED BASIS; EST. -2.0%(Q3 P -1.8%), JAPAN GDP DEFLATOR AT 3.4% IN 3Q Y/Y; EST. 2.8%" - BBG 
• MNI BRIEF: Japan's Oct Negative Real Wages Narrow. Inflation-adjusted real wages, a barometer of households’ purchasing power, remained in negative territory for the 10th straight month in October, falling 0.7% after a 1.3% drop in September, preliminary data from the Ministry of Health, Labour and Welfare showed Monday.
• The Nikkei 225 Index Average True Range(ATR) for the last 10 Trading days: 802 Points

Fig 1: Nikkei 225 Daily Chart

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

Today’s auction result extended the recent trend of firm pricing for ACGBs, with the weighted average yield printing 0.81bps through prevailing mids, according to Yieldbroker. Moreover, demand strengthened, as reflected by a cover ratio of 3.4333x, up from 2.8500x from the previous auction.

• The stronger demand came with the outright yield at a fresh cycle high, 20bps higher than the previous auction.
• A flatter 10s/30s yield curve versus the previous outing didn’t appear to be a negative technical factor.
• The recent improvement in sentiment toward longer-dated global bonds may have assisted demand.
• In the wake of the auction, the ACGB Jun-54 has traded ~1bps richer in the secondary market.

The S&P(ESZ5) Friday night range was 6856.75 - 6905.00, SPX closed +0.19%, Asia is currently trading around 6882. Risk continued its slow grind higher on Friday night. The Bulls will be liking this price action as the market consolidates above 6800 before potentially having another run higher into year-end. I remain wary of getting bullish up here, but it's tough to argue with the price action. This morning the futures opened a little higher, E-minis(S&P) +0.05%, NQZ5 +0.05%. On the day support should again be back toward the 6790-6820 area as the market looks to potentially challenge above 6900 again at some point en route to new highs. Only a break back below 6700-6750 would signal a potential pullback.

• The FOMC will be important this week with the market pricing in rate cuts, how many dissenters are needed to put a dent in this bullish view ?
• Oracle is also releasing results 10/12 and will be watched by those looking for reassurance on the AI sector.
• The S&P 500 Index Average True Range(ATR) for the last 10 Trading days: 68 Points

Fig 1: S&P 500 Index Daily Chart

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