Cabrera Capital Daily Game Plan

Friday September 25, 2020                                                        Trading
Desk: (312) 236-8907

TODAY’S GAME PLAN:  from
the trading desk, this is not research

DATA/HEADLINES:   
8:30ET Durable Goods;  11:00ET Fed’s Evans speaks;  3:00ET Fed’s Williams speaks

TODAY’S HIGHLIGHTS:

• Dogs used to detect coronavirus in pilot project at Helsinki airport  
  link
• FRANCE DAILY CORONAVIRUS CASES JUMP TO RECORD 16,096
  
• Biden leads Trump in Ohio, Nevada, Pennsylvania: Fox News poll
  
• Reuters/Ipsos poll shows Biden leads Trump nationally, but race much tighter in key states
• Chinese authorities have demolished thousands of mosques in Xinjiang, in the latest report of widespread human rights abuses

Yesterday’s higher close in U.S. indexes driven by stimulus hopes is fading today, with global equites generally on the back foot. Europe’s biggest
economies are struggling to bring the coronavirus back under control as hospitalizations climb following a surge in cases to record levels in some countries. Global virus cases topped 32 million, with France and the U.K. reporting the highest number of infections
since the start of the pandemic.

EQUITIES:  

U.S. equity-index futures are lower as investors weighed the receding prospects of a new American stimulus package against the global uptick
in coronavirus cases. Investors are watching moves by Democrats to craft a new $2.4 trillion stimulus bill to try to break the deadlock with Republicans, but chances of getting it passed before the November election appear slim. Texas Representative Kevin
Brady, the top Republican on the tax writing committee, called the move to draft a Democrat-only bill “a waste of time. ”The risk of a slowdown in the economic recovery has risen with the lack of another package, prompting Goldman Sachs Group and JPMorgan
to cut their forecast for U.S. growth in the fourth quarter. In the week ending Sept. 23, tech-focused ETFs suffered $1.23 billion worth of outflows, the largest since December 2018. Costco Wholesale Corp fell 2.5% as the warehouse chain recorded high coronavirus-related
costs for the second straight quarter, overshadowing its better-than-expected results.

December E-mini S&P futures -0.4%,
Nasdaq +0.1%, Russell 2000 futures -0.5%, Dow futures -0.55%. SPX has the .618 retracement from the June low (which had an 8% correction) as pivotal support short term. A clean break of this level would likely see the 200 day around 3100. Look for a bounce
today…

QQQ is short term negative below its
50dma

The DJIA is likely to bounce for a bit between the 50dma and 200dma while the NYSE Composite trying to hang on above its 200 day moving average.

The NYSE FANG+ Index is still holding the short term key 50 day moving average.

Banks should be able to get a bounce off the .618 retracement support in the Invesco KBW Bank ETF. Fifth Third (FITB) raised to overweight at
Morgan Stanley; PT $30

European stocks slipped, as fresh restrictions to contain a surge in coronavirus cases in the continent raised concerns about the pace of economic
recovery. The Stoxx 600 Index was trading 1.25%% lower before paring some of its losses.  Several cash indexes are printing fresh lows for the week and the Stoxx Europe 600 index is poised for its biggest weekly drop since June.  Airliners including Lufthansa,
Ryanair Holdings and IAG were among the biggest decliners as European leaders grappled with bringing infections back under control as hospitalizations climb again. Eurostoxx 50 and DAX drop 1.6% with autos, tech and travel the worst performing sectors.   

Asian stocks were mostly higher, led by materials and finance. Markets in the region were mixed, with Jakarta Composite and India’s Sensex Index
rising (+2.25%), and Hong Kong’s Hang Seng Index and Taiwan’s Taiex Index falling. The Topix gained 0.5%, with Moresco and Niitaka rising the most. South Korean shares closed 0.25% higher but posted their sharpest weekly fall in six months. The Shanghai Composite
Index retreated 0.1%. Shares of home-related companies fall in China following concerns about big developer Evergrande and the potential that peers may see tighter cash conditions. China Evergrande bonds tumbled after the world’s most indebted developer warned
it faces a potential default that could roil the nation’s financial system if it doesn’t get approval for a stock exchange listing.

FIXED INCOME: 
 

Treasuries gain slightly with stocks faltering as the Fed’s Williams and George round off a busy week for central speakers. Yields lower by up
to 2bp across long end of the curve, flattening 5s30s by almost 1bp.

METALS: 

Gold headed for the biggest weekly decline in six as a resurgent dollar weighed on the haven asset, with investors also assessing prospects for
further stimulus and the outlook for economic recovery.  December Gold futures are hovering just above the initial key Fibonacci support after breaking below the 50dma early in the week. Silver has been leading lower, testing its
100dma
yesterday. A break of this level would likely see downside momentum to the
200dma
and .618* retrace.

ENERGY:  

Oil is headed for a weekly decline on signs of increased supply and uneven demand. Oil traders have been reporting a sharp increase in Iraqi
exports for next month, while output from Libya has shown signs of increasing this week. The IEA reiterated its cautious outlook on the prospect for oil demand until the end of the year as the coronavirus outbreak looks set to place renewed restrictions on
people’s lives.

November WTI (shown as rolling actively traded contract) continues to hold below major resistance area around the 50 and 200 day moving averages
and the .618 retracement. WTI is down 1% and Brent -0.5%.

CURRENCIES:  

The US Dollar Index edged up and is on course for its best week since April. Investors are weighing the prospects for a $2.4 trillion stimulus
package proposed by US House Democrats which is much larger than what Senate Republicans have said they can accept. Sterling erased earlier gains in a choppy session on Friday as investors hoped Britain’s new scaled-back job support scheme will be followed
by other fiscal measures.  The Australian dollar is set for a 3.5% decline for the week, the most since the March selloff.

Spot US$ Index is testing the March significant low, which is initial key resistance after rallying 3% from the September 1^st low.
GBPUSD continues to hold initial key Fibonacci support. A clean break here would likely see the 1.2200 area.

TECHNICAL LEVELS: 
(futures)    

Colors within the report:
Green
is always the 200 period (day, week). Red is always 21,
Blue = 50,
Brown =
100  *Stars have added importance

Equity movers in early trading, as of 7:35am ET:

Advancers

• CLNY +19.7% (+$0.46); Colony Capital to Sell Hotel Portfolios in $2.8 Billion Deal
• FUV +11.5% (+$0.65)
• SHLL +7.8% (+$3.15)
• MOBL +6.7% (+$0.37)
• NVAX +6.4% (+$6.56); Endo in Pact With Novavax on Vaccine Candidate
• INO +6% (+$0.92)
• WKHS +5% (+$1.10)
• OUT +4.6% (+$0.65); Outfront Media Raised to Buy at Citi
• CZR +4% (+$2.13)
• DKNG +4% (+$2.02); DraftKings Rated New Buy at Argus
• DPHC +3.9% (+$0.86)
• PIC +3.1% (+$0.35)
• SAVA +3% (+$0.29)
• VEDL +3% (+$0.21)

Decliners

• SPI -25.6% (-$3.36)
• SSL -5.1% (-$0.39)
• FTI -4.1% (-$0.26)
• DVN -4% (-$0.36); The Crown Jewel of the Shale Patch Braces for a Biden Ban
• RYAAY -3.8% (-$3.08)
• STM -3.7% (-$1.11)
• AU -2% (-$0.53)
• OI -2.1% (-$0.20);
• BBL -2.1% (-$0.92)
• RDS/B -2.1% (-$0.54)
• MT -2.1% (-$0.26)
• SNY -2.2% (-$1.10)

David Wienke

Cabrera Capital Markets, LLC