Futures are flat as we enter the final month of a pretty solid year.

Questions remain, however, regarding the economy’s ability to withstand the coming policy changes.

continued for members…

Note that VIX made new five month lows during the holiday-shortened Friday session.The dollar has rebounded from a significant backtest of an important channel line, with a move to 108.92 still in the cards and potentially weighing on stocks. Oil and gas are still hanging around the lows of the last several months, with RB especially threatening lower lows.

The 10Y is getting a bit of a bounce after testing its SMA200 and SMA50 and red channel midlinel This bounce also enabled the 2s10s to bounce on the zero line – back up to +9 bps.

Decembers are rarely bearish, but when they are they can be very bearish as we saw in 2018 and 2022.

We have claims and NFP later this week, along with Michigan consumer sentiment. The initial retail sales readings after the Black Friday period were tepid: up 1.0% versus 2023.  It’ll be interesting to get a gauge of how consumers are viewing the road ahead.

UPDATE:  12:27 PM

ES just reached the 1.618 extension of the drop which began in January 2022.  If we’re going to get a significant correction, it should start right now.