There won’t be a summer rate hike, so I’ll focus here: Trader

Despite all signs from Fed Chair Janet Yellen that there will be an interest rate hike this summer, one trader insists the U.S. central bank is on hold, and that means good news for the commodities sector.

"You'll notice that after that disastrous 38,000 jobs added [in May], you saw big moves up in the commodities space and a move down in the dollar," Todd Gordon of TradingAnalysis.com told CNBC's "Trading Nation" on Monday. "That's reflecting the Fed sitting on the beach on their hands for the summer."

Gordon took a look at the market overall and identified the lead sectors kicking off the week on Monday. While the S&P 500 is up, he noted that the leading sectors in the marketplace appear to be industrials, materials and energy, with oil leading the way. Crude was up more than one percent midday.

The trend has Gordon willing to bet on the oil and gas production ETF (XOP) breaking through to new highs. More specifically, Gordon believes that the XOP is actually set to break above the $37 mark and has set $36.50 as the key level to watch for in the next coming days.


If the XOP does move to $36.50, Gordon predicts that oil will keep moving up.

"If we can get up to the $36.50 mark, it looks like XOP, along with crude oil, should be able to move up through the next several days," Gordon said.

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Trading Nation is a multimedia financial news program that shows investors and traders how to use the news of the day to their advantage. This is where experts from across the financial world – including macro strategists, technical analysts, stock-pickers, and traders who specialize in options, currencies, and fixed income – come together to find the best ways to capitalize on recent developments in the market. Trading Nation: Where headlines become opportunities.

Michael Santoli

Michael Santoli joined CNBC in October 2015 as a Senior Markets Commentator, based at the network's Global Headquarters in Englewood Cliffs, N.J.  Santoli brings his extensive markets expertise to CNBC's Business Day programming, with a regular appearance on CNBC's “Closing Bell (M-F, 3PM-5PM ET).   In addition, he contributes to CNBCand CNBC PRO, writing regular articles and creating original digital videos.

Previously, Santoli was a Senior Columnist at Yahoo Finance, where he wrote analysis and commentary on the stock market, corporate news and the economy. He also appeared on Yahoo Finance video programs, where he offered insights on the most important business stories of the day, and was a regular contributor to CNBC and other networks.

Follow Michael Santoli on Twitter @michaelsantoli

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