Bill Baruch's Morning Express: 10/19/26

E-mini S&P, last week’s close: Settled at 7704.25, down 86.75 on Friday and 155.50 for the week

E-mini NQ, last week’s close: Settled at 29,391.50, down 752.25 on Friday and 1,717.25 for the week

E-mini S&P and E-mini NQ futures each had the lowest weekly settlement since July 31st. Last week, we detailed an unwind of foreign investment in U.S. tech stocks, where currency exposure was unhedged, as shown by a mirroring move between the E-mini NQ and the Dollar Index. U.S. tech stocks are the best in the world, and investors must allocate in U.S. Dollars. This unwind was set in motion after OpenAI’s revenue shortfall was announced on October 8th. The E-mini NQ traded to a fresh record high on October 6th, and the reversal two days later created additional technical pressure, punctuated by higher-than-expected inflation in the September CPI report on October 14th. The AI supply chain, from semiconductor memory to equipment, was hit the hardest, and the SMH plunged 10.7% last week.

The E-mini NQ lost 5.5% last week, which is no walk in the park. When markets move of this magnitude, they begin to show a reflexivity of sorts, given concentrated positions, options, and reporting. On one hand, AI circular financing can be a concern. On the other hand, selling can be forced to manage risk. Those who needed to sell have sold, and we generate the viscous rebounds we have become accustomed to; reflexivity to both the downside and upside. Today will be a crucial tell: is this overnight strength real, or will a higher open get sold into?

Over the weekend, President Trump was again negotiating between Russia and Ukraine. With the midterms only two weeks away, he is pressuring peace talks and attempting to bring down diesel prices via an export deal with Russia and a delay in imposing further sanctions. Russia is also now proposing a U.S.-China summit on Ukraine.

The geopolitical news initially weakened Crude Oil futures overnight, buoying E-mini S&P and E-mini NQ futures from Friday’s lows. Both indices traded into the .618 retracement back to the highs coming into Friday’s session, but will face an uphill battle to clear major three-star resistances at and near those highs, detailed in our levels below. Friday’s low settlements will stand as a line in the sand and major three-star support at 7698.25-7705 in the E-mini S&P and 29,391-29,426 in the E-mini NQ; a break below here will encourage further selling. To avoid digging in near those lows, we need a constructive opening hour that holds above major three-star support at 7724-7727.25 in the E-mini S&P.

Bias: Neutral/Bullish

E-mini S&P (December)

Resistance: 7768.50-7774.75**, 7780.25-7785.50**, 7796.50**, 7800.75-7804.75***, 7816.25***, 7826.75-7828.25***, 7837.75***, 7855-7855.75***

Pivot: 7745-7753

Support: 7736.25**, 7724-7727.25***, 7717.25**, 7698.25-7705***, 7672.75-7776***, 7651-7656***, 7623***

E-mini NQ (December)

Resistance: 29,825-29,859**, 29,909-29,947**, 30,045-30,078***, 30,182-30,237***, 30,356-30,370***, 30,529-30,591***

Pivot: 29,743-29,746

Support: 29,622**, 29,549***, 29,391-29,426***, 29,226-29,269***, 29,053***, 29,688.50***

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