Market Recon Thursday

Good Morning,
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Crude Correlation
                    WTI Crude hit 49.95 yesterday after the inventory numbers, which is precisely where resistance should have been.  Now, if on the next attempt, the level is taken and held, 50 will likely become support, and the target price becomes 53. The Energy sector, and the Transports are benefitting greatly from this, but so is the marketplace in general. That brings us to correlation. On again? Off again? After discussing with my colleague, Steve Grasso on the merits of this so called correlation between the S&P 500, and the market price of WTI Crude, it becomes clear that all year, even after breaks, the two do recouple. May, and July were months where there was no easy match up to see, but especially recently, the pairing appears to be a match. For good? I doubt it. More likely if Crude should hit a wall somewhere around here due to more production coming on line, or a failure of OPEC to follow through, the equity market would hit a rough patch along with the commodity. However, should Crude at some point regain market prices close to the lofty levels of yesteryear, the correlation will fade away, as there was none when Crude did trade at those prices. This phenomenon was not visible from late 2014 through 2015.
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Trader Focus.
                    We seem to be at market inflection point… a place in time when you act, or eventually wish you had. A strong September ISM Non-Manufacturing print comes just after an improved September ISM Manufacturing print. What do they both have in common? Rapid growth in New Orders, which is the backbone of these reports, or any business for that matter. Remember, all the FOMC needs is Justification. The committee’s intent is clear. They are eager to raise the Fed Funds Rate. If we see a decent Non-Farm Payrolls number coupled with some wage growth tomorrow, and then Retail Sales print in positive territory next Friday, followed by Industrial Production that looks better on that following Monday… well, then September will easily be the best month for this economy since June. Can they go in November? I think that’s absurd, being that the policy meeting is on the second, and the Presidential election is on the eighth, but they will talk the talk. Talk has gotten us this far. Treasuries are clearly pricing in a less accommodative monetary environment, as are Gold, Utilities, Real Estate, and Telecom.  So are the Banks, after seemingly being untouchable just a few days ago.
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Macro
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08:30 – Initial Jobless Claims (Weekly): Expecting 256K, Last Week 254K. The most consistent data series in our macro world printed at 254K last week, dragging the four week moving average down to 256K, which is what we expect for today. In fact, every opinion that I’ve seen for this print is in the mid 250k’s. The only way this one impacts the marketplace is if something wildly unexpected happens. Probably a non-event, unless you are of the folks who filed this week.
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10:30 – Natural Gas Inventories (Weekly): Expecting 65B cf, Last Week 49B cf. Another very regular series, at least this year. Nat Gas Inventories are likely headed for their 25th build in 26 weeks. That’s half a year of just adding on. Unless you’re directly in the space, this one will pass quietly.