Morning Notes – Monday March 18, 2019

Directional Bias For The Day:

• S&P Futures are little changed; moving mostly sideways since 12:00 PM on Friday
• Odds are for a sideways to an up day – watch for break below 2828.50 for change of fortune
• No key economic data due:

Markets Around The World

• Markets in the East closed up
• European markets are mostly higher – Germany and Switzerland are down
• Currencies:
  

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

• Commodities:
  

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

• Bonds
  • 10-yrs yield is at 2.602%, up from March 15 close of 2.593%;
  • 30-years is at 3.011%, down from 3.020%
  • 2-years yield is at 2.458%, up from 2.438%
  • The 10-Year-&-2-Year spread is at 0.144, down from 0.155

Key Levels:

• Critical support levels for S&P 500 are 2818.26, 2810.79 and 2803.46
• Critical resistance levels for S&P 500 are 2830.73, 2843.89 and 2862.08
• Key levels for eMini futures: break above 2833.75, the high of 2:30 AM and break below 2828.50, the low of 6:00 AM

Pre-Open

• On Friday, at 4:00 PM, S&P future (June contract) closed at 2828.25 and the index closed at 2822.48 – a spread of about +5.75 points; futures closed at 2829.75 for the day; the fair value is -1.50
• Pre-NYSE session open, futures price action is mixed – at 9:00 AM, S&P 500 futures were up by +0.50; Dow down by -54; and NASDAQ down by -5.50

Directional Bias Before Open

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

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

Previous Session

Major U.S. indices closed mostly higher on Friday, March 15 in higher volume. Dow Jones Transportation Average closed lower. Most major indices are breaking above October 2018 high resistance. DJIA, DJT and Russell 2000 are still below their resistance levels.

For the week, U.S. indices closed higher in mixed volume. S&P 500 and Russell 2000 traded in lower volume for the week. Industrial is the only S&P sector that closed down during the week.

From Briefing.com:

The S&P 500 gained 2.9% this week in a buy-the-dip trade that was supported by a sidelined Federal Reserve, persistently low U.S. Treasury yields, and a weakening dollar. In addition, key leadership from Apple (AAPL) and semiconductor stocks helped the S&P 500 set a new high for 2019 and close at its highest level since Oct. 10.

The Dow Jones Industrial Average gained 1.6%, Nasdaq Composite gained 3.8%, and the Russell 2000 gained 2.1%.

10 of the 11 S&P 500 sectors finished notably higher with gains ranging from 1.8% (utilities) to 4.9% (information technology). The industrials sector underperformed with a gain 0.3%.

[…]

Soft economic data throughout the week contributed to the belief the Fed will stay put, which helped keep U.S. Treasury yields at persistently low levels.

The 2-yr yield remained unchanged at 2.44%, and the 10-yr yield declined four basis points to 2.59% — both near their lows for the year. The lower rates, along with a patient Fed, remained a supportive consideration for risk assets.

[…]

Elsewhere, UK Prime Minster May’s plan for Brexit did not win approval in the British Parliament, yet Parliament did vote in favor of extending the Brexit deadline until June 30 at the latest. Lawmakers still need to agree on an alternate deal, and the delay still needs to be approved by all 27 member states of the European Union.

• S&P 500 Sectors