This website uses cookies to collect usage information in order to offer a better browsing experience. By browsing this site or by clicking on the "ACCEPT COOKIES" button you accept our Cookie Policy.

Market Outlook: Dec. 3, 2020

RJO Futures
Visit: RJO Futures


Senior Asset Manager

Before you read any further, our Inflation tracker ticked up to 1.23% y/y in Q4 and we think that could easily DOUBLE by Q2 2021 to 2.4% AND US GDP could print more than a 10% y/y acceleration by Q2 2021.  Yes, if this is the case and we’re correct….Bond yields aka real rates are going HIGHER!  You know what doesn’t like HIGHER interest rates?  Gold. 


US Dollar: 

The USD is now entering perhaps a “crash” phase.  -10% since June, you can clearly overlap a chart of the Fed’s balance sheet expansion and the US Dollar Index from June to present and see it “gator mouth”.   While main street doesn’t fully understand the ramifications and consequences of this, we are very much aware, and are able to capitalize on these macro driven, inflation accelerating situations.  Scenario 2 – Growth and Inflation Accelerating remains the call for the next 3-6 months.

Gold & Dollar Correlation: 

A 3 day bounce, while the correlation of Gold to Dollar’s flips back to negative/inverse.  Quite the opposite over the past 3 weeks however, where Gold and the Dollar were carrying a positive correlation.  I know many of you observed this, because it quite frankly it was frustrating you.  That’s the non-linearity we speak of in markets, anything can happen at any time.  Embrace the “randomness” and play the game that’s in front of you and not the one that you want.  Now, Gold is nearing immediate OVERBOUGHT/BEARISH trend, while the US Dollar is now signaling immediate OVERSOLD (4 days straight).  We think it’s a high probability that Gold re-probes lower levels from here, and the Dollar catches a “feeble” bid.  Yes we’ve gone bearish on Gold in the near-term, but that doesn’t mean we won’t like Gold again from lower levels, if the US Dollar registers and OVERBOUGHT signal.  I’m not a “perma” anything, I’m a fully liberated trader that will move with the tides of the market.  Always remember that its important to be open minded about market conditions.  With that said, I’d rather buy Copper or Platinum over Gold at this juncture of the cycle. 


While many of the markets we’re tracking and trading are now issuing overbought signals, we’ll have to be patient for our next entry points.  They will come to us.  You should never feel like you HAVE to chase a market, but the market always gives you another opportunity.  Patience is a big part of what we do here. 


SP500 -0.02%, NQ +0.14%, RTY +0.06%

A few other notes:

Oil -0.40% remains bullish trend/we’d welcome the low end of the range for a buy opportunity.

Platinum +1.89% remains bullish trend and definitely looking to add (and enter) new positions from the low end of our range here – 975.00

Corn +0.41% to 425.50 – we may look at shoring up profits here today off the open

MarketTrendRange LowRange HighNotes
SP500Bullish35723684Higher high in the range today – this is not a short in our opinion, you wait to buy….
Nasdaq 100Bullish12,06412,531Immediate OB here.  We remain BULLISH – wait to buy
Russell 2000Bullish17731867Still a long side trade from lower levels
10yr YieldBearish0.82%0.97%yields bounced 8bps yesterday as inflation expectations ramped!  Bonds are a SELL from the low end of yield rng
VIXBearish19.2327.31Immediate OS here – Bearish trend
OilBullish42.0747.1Waiting for an OS signal before we go all in.
GoldBearish17701853Rally’s (like today) are likely sell side trades until further notice is given – we’ll wait for the top of the range
USD (Cash)Bearish91.0392.31Immediate OS here, Dollar should bounce into the ECB next week, but is on “Crash” watch here
EUR/USDBullish1.191.21We go this one wrong, Europe data has outperformed expectations as of late.  We still think a pull back is likely
Yen FuturesBullish95.4296.86Increased long position in commitment of traders report

Originally Posted on December 3, 2020 – Market Outlook: Dec. 3, 2020

Disclosure: RJO Futures

The risk of loss in trading futures and/or options is substantial and each investor and/or trader must consider whether this is a suitable investment. Past performance, whether actual or indicated by simulated historical tests of strategies, is not indicative of future results.

Disclosure: Interactive Brokers

Information posted on IBKR Traders’ Insight that is provided by third-parties and not by Interactive Brokers does NOT constitute a recommendation by Interactive Brokers that you should contract for the services of that third party. Third-party participants who contribute to IBKR Traders’ Insight are independent of Interactive Brokers and Interactive Brokers does not make any representations or warranties concerning the services offered, their past or future performance, or the accuracy of the information provided by the third party. Past performance is no guarantee of future results.

This material is from RJO Futures and is being posted with permission from RJO Futures. The views expressed in this material are solely those of the author and/or RJO Futures and IBKR is not endorsing or recommending any investment or trading discussed in the material. This material is not and should not be construed as an offer to sell or the solicitation of an offer to buy any security. To the extent that this material discusses general market activity, industry or sector trends or other broad based economic or political conditions, it should not be construed as research or investment advice. To the extent that it includes references to specific securities, commodities, currencies, or other instruments, those references do not constitute a recommendation to buy, sell or hold such security. This material does not and is not intended to take into account the particular financial conditions, investment objectives or requirements of individual customers. Before acting on this material, you should consider whether it is suitable for your particular circumstances and, as necessary, seek professional advice.

In accordance with EU regulation: The statements in this document shall not be considered as an objective or independent explanation of the matters. Please note that this document (a) has not been prepared in accordance with legal requirements designed to promote the independence of investment research, and (b) is not subject to any prohibition on dealing ahead of the dissemination or publication of investment research.

Any trading symbols displayed are for illustrative purposes only and are not intended to portray recommendations.

Disclosure: Forex

There is a substantial risk of loss in foreign exchange trading. The settlement date of foreign exchange trades can vary due to time zone differences and bank holidays. When trading across foreign exchange markets, this may necessitate borrowing funds to settle foreign exchange trades. The interest rate on borrowed funds must be considered when computing the cost of trades across multiple markets.

Disclosure: Futures Trading

Futures are not suitable for all investors. The amount you may lose may be greater than your initial investment. Before trading futures, please read the CFTC Risk Disclosure. A copy and additional information are available at

trading top