What do ice cream, butter futures, and the S&P 500 have in common? Momentum! In this high-energy Tech Talk, we break down a first-ever mother-daughter chart request (shoutout!), unpack a textbook breakaway gap in the butter market, and explore why the S&P looks like a slingshot ready to launch past 6000. From dairy dynamics to equity excitement, we connect the charts and the chatter to help you see what’s next.

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(Transcipt auto-generated)

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Future trading involves risk and not suitable for all investors. Content provided in the site for educational purposes and is not a solicitation to buy or sell commodities.

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Hello everybody. Welcome back to another episode of Tech Talk. I am Cody, he is Andy. It is Wednesday, June 4th about 1235 Central Time. How are you doing today?

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You know what? If I was any better, I would be about that. I see that you’re you put some sunscreen on this fire.

00;00;26;16 – 00;00;28;03

I did even it out a little bit.

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Even it out a little bit. Good for you. I forgot to put sunscreen on. I got I’m burnt. Okay, I got burns. You know, it’s summer. I don’t know what I was thinking, what I was thinking, you know, just let it happen.

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Just let this get burnt as summer. That’s what it’s there for.

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Burnt up summer is upon us, you know. That means ice cream.

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More ice cream.

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More ice cream, more cowbell, more ice cream. And this segues really well into our request from Joey and her mom. So it’s kind of like a this is the first time ever we had like a mother daughter duo request.

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Watching TikTok together, wanting to see.

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Butter swap butter, or talking about ice cream or spot butter. Let’s go.

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Hey.

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A little papa brewski here. This is this is looking perky. So are we. We have this in here. I didn’t touch any of these lines from last time. Okay, let’s see if we can widen this bad boy out a little bit. Let’s do that, shall we? So we put in here yesterday. We broke or not like yesterday, but the last time we looked at it broke out of this downtrend.

00;01;26;18 – 00;01;46;26

So I’m going to delete that. So it’s in there. It’s timestamped. It’s deleted. So we can kind of widen this thing out. It broke out of this major downtrend. And you’re super interesting about this. You ready I don’t know this right here I think you could characterize it at what is known as a.

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Oh I think I know you’re gonna say.

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Breakaway gap.

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Okay. Breakaway gap. It doesn’t actually need to be filled where you’re going away.

00;01;56;00 – 00;02;19;20

Correct. When you see a gap like this after a major trend has been broken, this is typically the beginning of a new trend, a breakaway gap. It is breaking away from the previous price action. It’s doing it on fantastic volume. By the way. We’ve seen tons of loads change hands at the same time. But also here we have we’ll look at, we’ll look at the futures market in a second with the futures market is saying we got more to go to.

00;02;19;20 – 00;02;37;10

The upside there’s a nice healthy premium baked into this bad boy. And we’ve got we’re well discounted to the rest of the world. Right. Some of the I think earlier this week Spain our pointed out that European butter futures efforts were trading a US equivalent about 375, about 375.

00;02;37;16 – 00;02;44;04

We talked about it on the GTC, and he had mentioned that on the GDP. And I had a couple people email it and said, is that correct and.

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Is that correct? Did you not in his 75. No, no no no sir no ma’am. 370.

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Five.

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So to put that in perspective, I have to scroll. Oh, look at how far I had to scroll. That’s what I had. The look at how far I had to minimize this thing to get up there. That’s where that is.

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Why.

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So yes. Yeah. We do this Fibonacci retracement here. The first step would be a 30, a third, which is 260. I think we blow through that and the next thing does this thing right. I mean, I think the next step is to get in between this 50% in two thirds, 271 to 283. What’s interesting is we saw a similar, type gap right here.

00;03;25;05 – 00;03;25;25

Right?

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Yeah.

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And then plummet. I’ll use the word plummeted. It plummeted just almost right down to 225. So I think you got to be super careful of this guy right here. This looks like a breakaway gap. Again, we’re super cheap, but the rest of the world on the spot basis the futures markets they’re from a cash and carry standpoint. It’s telling us that we’re going up.

00;03;45;11 – 00;04;11;12

Yep. I was super interesting too is that the futures markets not just it’s it’s maintaining a premium. So today’s cash market this is work. We’re recording post cash market today. So today’s session was up $0.06 $0.06. And futures up front up an equal amount. So it’s not like it’s giving up that carry. So the futures market is telling us that that that carry is going to maintain which gives even more incentive for price action to rally on the on the on the spot basis.

00;04;11;15 – 00;04;12;11

This thing looks strong.

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Yeah I agree, I think that’s what John had mentioned also on the GDP. And I know he mentioned it internally also was that cash and carry is extremely strong going out into the end of this year.

00;04;20;28 – 00;04;46;21

Very strong. Now what’s super? Here’s another one though. There’s the momentum. It’s dead bang at zero I mean it’s right there. Oh yeah it it crossed the zero September right at that gap by the way. See that. Look at that. What a coincidence. So. Oh the if if we get this another close higher on a weekly basis. Look next week this will be positive territory for the first time since Q3 of 2024.

00;04;46;23 – 00;05;07;25

That’s bullish. Same thing here. He dipped into oversold clearly got out of it. And you still have plenty of room. There’s still room for that to go for. It’s considered overbought. So from a technical basis you’re going to have like something has to materially change in the marketplace. You need to see some sort of new information. Take a look at this.

00;05;07;27 – 00;05;29;17

And I can’t see a bearish argument here when you just look at the secondary stuff. So and let’s take a little piggy. This is our second chart. This is also comes at request from Joey and her mob. This is September Butter futures. Really nice bull flag year. Yeah look at this pack I mean.

00;05;29;20 – 00;05;31;26

Breaking away after today.

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Yeah. That looks cool. Big big uptick here. Clearly got out of this downtrend right I mean you could say that we’ve been out of it for a while right? I mean it’s it depends on where you want to draw the line. But basically call it right there. Right. Got that. Whoops. Got out of it. Consolidated right. That’s always a good sign of moving in the opposite direction right.

00;05;53;29 – 00;06;19;05

You know just pop right back out of it. You have a nice period of like accumulation. Consolidate right and then start to go. So I would not be surprised at all if this contract has yet to see contract highs. So contract highs okay to 88. Yeah. Contract highs are approximately 288. I would not be surprised at all given this structure.

00;06;19;07 – 00;06;42;20

Let’s just let’s just measure this bad boy out here for a second. Hang on. So what you’d want to do, you call this a flagpole, right. There you go. Okay. And depends on where you want to put it, but let’s say it breaks out that I would argue is in $3, oh, $3 way. Bullish. What was that number that the chart was talking about?

00;06;42;22 – 00;06;44;01

For Europe.

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Yeah. You already said.

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370.

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Five 375. So the three handle up to.

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The three.

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Three, right. The futures look great. This is a nice this is a great formation here. Money flow looks at.

00;06;54;20 – 00;07;02;04

Volatility that we saw last week into this week is amazing. Limit up limit down like I think it was Tuesday Wednesday last week.

00;07;02;09 – 00;07;21;06

Then I love the point you’re making for sure. Like what ended up happening was basically the futures. We had that big rally and then cash broke like back. You know I think it was like down 6 or $0.07 or something that day down like 6 or $0.07. But then pre cash the next day we were already up nearly.

00;07;21;07 – 00;07;41;19

We retrace like 80% of that break before the cash market when the previous day’s cash market was down like 6 or $0.07 and futures got hammered. So like the price action on the futures, to your point, the price action in futures, it’s just so impressive. It’s like buyers like that then say like buy them like this is a this is an opportunity that is that’s bullish for sure.

00;07;41;19 – 00;07;57;10

The the way that the way it traded is just like there’s no two ways about it that’s bullish. So yeah I mean I think I think butter is like a sneak is going to is like you think about like cheese has made this big move here recently right. Or the last like 45 days. I think butter is going to be the one, the next one in the industry.

00;07;57;13 – 00;08;00;12

Okay. Great request sounds that yeah.

00;08;00;12 – 00;08;18;10

Great requests coming into Joe and for him will bring more of them. All right. Last but certainly not least this one more of a macroeconomic view. So I think I told you this story, but like Joe is we used to call the spew. And I always thought that that was just like the name that they used on the floor for the S&P.

00;08;18;10 – 00;08;38;16

But really that was just like a front month at the time when it was spew. The September contract have called the spill. So I just like stuck with it. I didn’t know that. So he scolded me when I typed in SPX 001 time. Anyways, so this is the June S&P contract. This, this is looking awfully perky. What do you think?

00;08;38;19 – 00;08;43;00

It’s looking pretty good. Retirement’s on the way back.

00;08;43;03 – 00;09;04;16

Pretty good back at 6000. This is the. Yeah I mean look at I mean the volatility here this year has been outrageous. All the tariff noise and all the, you know, all that stuff going on. It’s moved a thousand points. Thousand points since April. April’s low. Think about that. That’s just massive I mean if you want to say.

00;09;04;21 – 00;09;16;29

I’m in the market in that time in the market, but if you could have timed that move, I mean, come on, come on. Momentum is just what is it just above zero and the momentum also first.

00;09;17;01 – 00;09;37;12

So what sticks out to me about this one is you have assuming let’s say we get a like we talked about it last time, we were kind of putting around the 6000 mark. Right. And this was, you know, back in early sitting that late that early March, you and I talked about it. Wherever we go from 6000, it’s going to be pretty nasty move.

00;09;37;14 – 00;10;01;25

Right. It just seems like this price point where we you kind of putter along, but it’s just like this. I feel like it’s just this big mental number that everybody has at 6000 S&P and 59.996 thousand. So this looks like it’s ready to go higher right. So you have the higher low end here in the market. Isn’t even like giving it a chance to really break down from you know from like here.

00;10;01;25 – 00;10;15;27

Right. And so you have this break comes back, tries again, fails to get down to a new low and is now re approaching this number where once we crack through it it got really volatile. I think this gets this gets dicey to the upside.

00;10;16;03 – 00;10;16;22

To the upside.

00;10;16;27 – 00;10;27;28

I think if you get a close through the 6000 and then open higher. I think you guys are talking about like do we get back the I think you start talking about getting back up in the year contract guys for the year.

00;10;28;00 – 00;10;29;03

Those 6200.

00;10;29;10 – 00;10;46;09

Yeah this looks good too. I mean to keep this as a weekly. So you keep bumping up against you know this this you can only keep bumping up against these highs for you know so many times before you just get that next like but and then like the next point the resistance is this high from right here. But I mean this is just like a great look.

00;10;46;09 – 00;10;49;22

Look at this V bottom. Nice v moderate there. Those are just.

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Very typically them.

00;10;51;13 – 00;10;56;09

It’s like it’s you know slingshot engaged. What do you like got sent. Slingshot.

00;10;56;12 – 00;11;02;21

It’s like yeah it is clean shot I mean that is exactly what it looks like. Yeah. Get a 5000. Right.

00;11;02;22 – 00;11;24;24

Mega Cody bought everything at 5000 I wish. So I guess the flip side of it is, you know, it’s hard to argue that this could make an m because you’re already, like, traditionally, you’d want to see it stale, like kind of around here. Right. Failed to test this area, which it already has. So this close at 5981 is higher than this close of 5960.

00;11;24;24 – 00;11;26;06

Basically.

00;11;26;08 – 00;11;30;21

So you’re kind of made a lower high. If we were going to m formation this thing.

00;11;30;23 – 00;11;39;00

Correct. Correct. You’d be looking for it to stall out. Like kind of around here below this, below this kind of formation right here and then start to back off.

00;11;39;00 – 00;11;40;02

Yeah.

00;11;40;05 – 00;11;46;24

But this just didn’t do that. And so the lower high here that it’s making strong like bull man.

00;11;46;26 – 00;11;51;11

Strong like bull like everyone likes to hear that for the S&P usually.

00;11;51;11 – 00;12;10;25

Yeah. You know what though I can never figure out why. I can never figure out why. Like you’d see like on the news stock’s down like 3 or 400 points or whatever it is. Like where is the guy who’s short in the back like now they always have like the guy who’s just like, oh. So all right, well that’s it.

00;12;10;25 – 00;12;12;29

That’s all I got. Yeah. Any closing remarks.

00;12;12;29 – 00;12;26;21

There? I mean, we greatly appreciate Joey and or mom for, for asking you for the the butter. I mean, going into they wanted to take a look at something for ice cream a little bit on the class for side butter was the perfect, perfect into that.

00;12;26;24 – 00;12;27;18

Perfect.

00;12;27;21 – 00;12;41;03

Keep coming everybody, you have more. We’ve got time next week to have more requests, I guess. But until then, that’s kind of going to wrap up the show for Andy, myself and Paige on the back end, keeping us in line and making sure we don’t make fools of ourselves.

00;12;41;08 – 00;12;42;22

We can’t make any promises on that.

00;12;42;29 – 00;12;50;10

We appreciate you guys watching tuning in. Give us a like a thumbs up. Subscribe to the channel if you have not, tell your friends, tell your family. Play your foes, tell everyone.

00;12;50;10 – 00;12;51;27

And family is a close.

00;12;51;29 – 00;12;57;11

Watch tech talk. Have a great week and even better weekend. We’ll see you guys next time.

00;12;57;13 – 00;12;57;28

Bye!

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