Morning Notes – Wednesday, April 17, 2024

Directional Bias for the Day:

  • S&P Futures are higher at 9:00 AM. Futures have been moving sideways since 8:00 PM on Monday within a 50-point range.
  • The odds are for a sideways to an up day – watch for a break above 5123.25 or a break below 5075.75 for clarity.
  • The major economic data report due during the day:
    • Beige Book at 2:00 PM.
  • Weekly: Up
  • Daily: Uptrend Under Pressure
  • 120-Min: Down
  • 30-Min: Down-Side
  • 15-Min: Side
  • 6-Min: Side

Key Levels:

  • Critical support levels for the S&P 500 are 5049.53, 5038.83, and 5000.52.
  • Critical resistance levels for the S&P 500 are 5079.84, 5107.94, and 5122.30.
  • The key levels for E-mini futures are 5123.25, the high at 2:00 PM, and 5101.50, the low at 8:15 AM.

Pre-Open

  • On Tuesday at 4:00 PM, S&P futures (June 2024) closed at 5092.00, and the index closed at 5051.41 – a spread of about +40.25 points; the futures closed at 5092.50; the fair value is -0.50.
  • Pre-NYSE session open, futures were higher – at 9:00 AM, the S&P 500 futures were up by +20.75, Dow by +48, and NASDAQ by +55.75.

Markets Around the World

  • Markets in the East closed mixed – Shanghai, Hong Kong, and Singapore closed higher; Tokyo, Sydney, and Seoul closed down; Mumbai was closed.
  • European markets are higher.
  • Currencies (Compared to two weeks ago):
Up Down
  • Dollar index
  • USD/JPY
  • USD/CHF
  • USD/CAD
  • INR/USD
  • EUR/USD
  • GBP/USD
  • AUD/USD
  • NZD/USD
  • Commodities (Compared to two weeks ago):
    • Energy futures are mixed.
    • Precious metals are higher.
    • Industrial metals are higher.
    • Soft commodities are mixed.
  • Treasuries (Compared to two weeks ago)
    • The 10-year yield closed at 4.673, up +31.2 basis points from two weeks ago.
    • The 30-year is at 4.767%, up +26.6 basis points.
    • The 2-year yield is at 4.998%, up +29.7 basis points.
    • The 10-Year-&-2-Year spread is at -0.325, up from -0.340.
    • The 30-Year-&-10-Year spread is at 0.094, down 0.140.
  • VIX
    • At 18.00 @ 8:00 AM; down from the last close; above the 5-day SMA
    • Recent high = 19.56 on April 16; low = 14.59 on April 10; Sentiment: Risk-Neutral-Neutral

The trend and patterns in various time frames for the S&P 500:

Weekly:
  • The week ending on April 12 was a red candle with small upper and lower shadows near all-time highs.
  • Broke above a down-sloping Flag on November 14 – the 100% extension target around 4901.00 is achieved, and the 161.8% extension target is near 5395.00.
    • Stochastic (9,1, 3): %K is below the %D.
    • RSI-9 has declined to just above 60 from above 75.
  • The week was down -80.93 or -1.6%; the 5-week ATR is 105.79.
  • Third down week in the last five weeks and fifth in the previous ten weeks
  • The weekly pivot point=5152.05, R1=5196.17, R2=5268.92; S1=5079.30, S2=5035.18; S1 pivot level was breached
  • Above 10-week EMA, 39-week SMA, and 89-week SMA
  • Uptrend
Daily
  • A small Doji like red candle just above a support level – the up-gap created on February 22.
  • ┬áBroken below an upsloping channel since late October 2023.
    • Stochastic (9, 1, 3): %K has turned up but is still below the %D; just above zero.
    • RSI-9 is around 30; below 8-day EMA.
  • Below 20-day EMA and above 50-day EMA; above 100-day SMA, and 200-day SMA.
  • Uptrend Under Pressure
2-Hour (E-mini futures)
  • Downtrend since March 31. Broke below several support levels. Next support level is around 5018.00.
    • RSI-21 has bounced up to above 50 from below 20 after making Bullish Divergence.
    • At/below EMA20, which is below EMA10 of EMA50.
  • Bias: Down
30-Minute (E-mini futures)
  • Moving sideways to up since 3:00 PM on Monday around 5110.00.
    • RSI-21 has been moving around 50.
    • At/above EMA20, which is at/below EMA10 of EMA50.
  • Bias: Down-Side
15-Minute (E-mini futures)
  • The Bollinger Band (20, 2.0) has been moving sideways to up since 8:00 PM on Monday.
  • The Bollinger Band is contracting a bit since 8.30 AM.
  • Bias: Side

Previous Session

Major U.S. indices closed mostly lower on Tuesday, April 16 in mixed volume. Dow Jones Industrial Average closed higher. Dow Jones Transportation Average and Russell 200 traded in higher volume. The major indices opened flat and then traded sideways until mid-afternoon and then traded with a little more volatility.

All but three S&P sectors – Staples, Technology, and Healthcare – closed lower. The dollar index closed higher, energy futures and precious metals closed mixed. industrial metals, and most of the soft commodities closed lower. The bonds gained and the US Treasury Yields declined.

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