Morning Notes – Wednesday March 13, 2019

Directional Bias For The Day:

• S&P Futures are higher; moving up since 10:30 PM on Tuesday
• Odds are for an up day – watch for break below 2797.75 for change of fortune
• Key economic data due:
  • Core PPI (0.1% vs. 0.2% est.; prev. 0.3%) at 8:30 AM
  • PPI  (0.1% vs. 0.2% est.; prev. -0.1% ) at 8:30 AM
  • Core Durable Goods Orders (-0.1% vs. 0.1% est.; prev. 0.3%) at 8:30 AM
  • Durable Goods Orders (0.4$ vs. -0.5% est.; prev. 1.3%) at 8:30 AM
  • Construction Spending (e.5%) at 10:00 AM
  • U.K. Parliament Brexit Vote – sometime today

Markets Around The World

• Markets in the East closed mostly down – Mumbai was up
• European markets are higher
• Currencies:
  

  Up	Down
  EUR/USD GBP/USD USD/JPY USD/CAD	Dollar index USD/CHF AUD/USD NZD/USD USD/INR

• Commodities:
  

  Up	Down
  Crude Oil Gold Silver Copper Platinum Palladium Cocoa Cotton	NatGas Sugar Coffee

• Bonds
  • 10-yrs yield is at 2.624%, down from March 12 close of 2.627%;
  • 30-years is at 3.015%, unchanged
  • 2-years yield is at 2.455%, unchanged
  • The 10-Year-&-2-Year spread is at 0.169, down from 0.172

Key Levels:

• Critical support levels for S&P 500 are 2787.84, 2773.82 and 2747.61
• Critical resistance levels for S&P 500 are 2798.32, 2806.27 and 2816.88
• Key levels for eMini futures: break above 2806.00, the high of 8:00 AM and break below 2797.75, the low of 5:30 AM

Pre-Open

• On Tuesday, at 4:00 PM, S&P future (June contract) closed at 2797.25 and the index closed at 2791.52 – a spread of about +5.75 points; futures closed at 2797.25 for the day; the fair value is +0.00
• Pre-NYSE session open, futures price action is to the upside – at 8:45 AM, S&P 500 futures were up by +6.25; Dow by +76; and NASDAQ by +22.50

Directional Bias Before Open

• Weekly: Uptrend
• Daily: Up Under Pressure
• 120-Min: Up
• 30-Min: Side-Up
• 15-Min: Side-Up
• 6-Min: Up

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

Previous Session

Major U.S. indices closed mostly higher on Tuesday, March 12 in mostly higher volume. Dow Jones Industrial Average and Dow Jones Transportation Average closed down and Russell 2000 traded in lower volume. Most indices made relatively small candle with small upper shadows and smaller lower shadows.

From Briefing.com:

The S&P 500 gained 0.3% on Tuesday, adding to its strong start to the week. Softening inflation data, persistently low U.S. Treasury yields, and leadership from Apple (AAPL 180.91, +2.01, +1.1%) and Alphabet (GOOG 1193.20, +17.44, +1.5%), helped the market overcome continued weakness in Boeing (BA 375.41, -24.60, -6.2%).

The Nasdaq Composite gained 0.4%, and the Russell 2000 gained 0.1%.
The Dow Jones Industrial Average lost 0.4% amid Boeing’s notable problems pertaining to the grounding of its 737 MAX by several countries, as well as the European Union.

[…]

The S&P 500 health care (+0.7%), utilities (+0.6%), energy (+0.6%), and communication services (+0.6%) sectors led Tuesday’s advance. Conversely, the industrials (-0.9%) and consumer staples (unch) sectors underperformed.
The broader market began the day modestly higher, supported by a soft Consumer Price Index (CPI) for February.

[…]

The soft data prompted further strength in the U.S. Treasury market, which sent yields even lower.

The 2-yr yield declined three basis points to 2.44%, and the 10-yr yield declined four basis points to 2.61%.

[…]

• Total CPI was up 0.2% month-over-month in February, as expected, while core CPI, which excludes food and energy, was up only 0.1% (Briefing.com consensus +0.2%).
o The key takeaway from the report is that inflation trends for total CPI and core CPI both moved lower on a year-over-year basis. Total CPI was up 1.5%, versus 1.6% for the 12 months ending in January, whereas, core CPI was up 2.1%, versus 2.2% for the 12 months ending in January. The disinflation will indeed keep the Fed in a patient state of mind.
• The NFIB Small Business Optimism Index for February increased to 101.7 from the prior reading of 101.2 in January.

[…]

• S&P 500 Sectors