Morning Notes – Thursday, March 9, 2023

Directional Bias For The Day:

• S&P Futures are higher at 8:30 AM; moved up more than 25 points since 8:15 AM and after the Unemployment Claims report – breaking above a Horizontal Channel between 4003.25 and 3971.50
• The odds are for an up to a sideways day – watch for a break below 3980.00 for a change of sentiments
• The major economic data report is due during the day:
  • Unemployment Claims ( 211K vs. 195K est.; prev. 190K) at 8:30 AM

Directional Bias Before Open:

Key Levels:

• Critical support levels for S&P 500 are 3975.26, 3969.76, and 3939.12
• Critical resistance levels for S&P 500 are 4000.41, 4023.08, and 4036.09
• The key levels for E-mini futures are a break above 4027.00, a high at 12:00 PM on Tuesday,  and a break below 3980.00, a low at 8:00 AM

Pre-Open

• On Wednesday at 4:00 PM, S&P futures (March 2023) closed at 3995.50, and the index closed at 3992.01 – a spread of about +3.50 points; the futures closed at 3995.00; the fair value is +0.5
• Pre-NYSE session open, futures were mixed – at 9:00 AM, S&P 500 futures were up by +11.50, Dow by +88, and NASDAQ by +37.50

Markets Around The World

• Markets in the East closed mostly lower – Tokyo and Sydney closed higher
• European markets are lower
• Currencies (Compared to two weeks ago):

• Commodities (Compared to two weeks ago):
  • Energy futures are higher
  • Precious metals are lower
  • Industrial metals are lower
  • Soft commodities are mostly lower
• Treasuries (Compared to two weeks ago)
  • The 10-year yield closed at 3.976, up +5.3 basis points from two weeks ago;
  • The 30-year is at 3.878%, down -5.0 basis points;
  • The 2-year yield is at 5.070%, up +37.1 basis points;
  • The 10-Year-&-2-Year spread is at -1.094, down from -0.776
  • The 30-Year-&-10-Year spread is at -0.098, down from 0.005
• VIX
  • At 19.32 @ 8:45 AM; up from the last close; above the 5-day SMA;
  • Recent high = 23.63 on February 22; low = 18.11 on February 15
  • Sentiment: Risk-Neutral

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

Previous Session

Major U.S. indices closed mostly higher on Wednesday, March 8, in lower volume. Dow Jones Industrial Average closed down.

Major indices opened flat and fluctuated up and down most of the day before closing on the last upswing with modest gains.

Four S&P sectors – Consumer Discretionary, Energy, Financials, and Healthcare – decline.

From Briefing.com:

[…] The 2-yr note yield rose five basis points to 5.06% and the 10-yr note yield settled unchanged at 3.98%. […] With the late afternoon push higher, most of the S&P 500 sectors registered a gain today. Moves were somewhat modest in scope with the exception of real estate (+1.3%), information technology (+0.8%), and utilities (+0.8%). The energy sector (-1.0%), meanwhile, logged the biggest decline. […] Nasdaq Composite: +10.6% YTD Russell 2000: +6.7% YTD S&P Midcap 400: +6.4% YTD S&P 500: +4.0% YTD Dow Jones Industrial Average: -1.0% YTD […] The weekly MBA Mortgage Application Index rose 7.4% with refinancing applications increasing 9.0% and purchase applications rising 7.0%. The ADP Employment Change showed that private payrolls rose by 242,000 in February (Briefing.com consensus 195,000) following a revised 119,000 increase in January (from 106,000). The trade deficit for January widened to $68.3 billion (Briefing.com consensus -$69.0 billion) from an upwardly revised $67.2 billion (from -$67.4 billion), as imports were $9.6 billion more than December imports and exports were $8.5 billion more than December exports. JOLTS – Job Openings totaled 10.824 million in January following a revised 11.234 million in December (from 11.012 million). Weekly EIA Crude Oil Inventories showed a draw of 1.69 million barrels following last week’s build of 1.17 million barrels. […] Overseas:  Europe: DAX +0.5%, FTSE +0.1%, CAC -0.2% Asia: Nikkei +0.5%, Hang Seng -2.4%, Shanghai -0.1% Commodities:  Crude Oil -0.90 @ 76.62 Nat Gas -0.13 @ 2.72 Gold -1.70 @ 1817.80 Silver -0.07 @ 20.11 Copper +0.04 @ 4.02