Market Remarks

Morning Notes – Tuesday, September 10, 2024

Sunil Sharma

Directional Bias for the Day:

  • S&P Futures are higher at 8:30 AM. Moving up from 5462.50 since 5:15 AM after moving sideways during the Asian session. Up more than 30 points.
  • Odds are for an up day with elevated volatility. Watch for a break below 5462.50 for a change of sentiments.
  • The economic data due during the day:
    • NFIB Small Business Index (91.2 vs. 93.6 est.; prev. 93.7%) at 5:59 AM.
  • Weekly: Uptrend Under Pressure
  • Daily: Uptrend Under Pressure
  • 120-Min: Down-Side
  • 30-Min: Up-Side
  • 15-Min: Side
  • 6-Min: Side-Up

Key Levels:

  • Critical support levels for the S&P 500 are 5449.58, 5434.49, and 5427.51.
  • Critical resistance levels for the S&P 500 are 5483.38, 5507.33, and 5546.30.
  • The key levels for E-mini futures are 5493.00, the high at 1:00 PM on Monday and 5462.50, the low at 5:00 AM.

Pre-Open

  • On Monday at 4:00 PM, S&P futures (September 2024) closed at 5479.50, and the index closed at 5471.05 – a spread of about +8.50 points; the futures closed at 5479.50; the fair value is +0.00.
  • Pre-NYSE session open, futures were higher – at 8:15 AM, the S&P 500 futures were up by +12.75, Dow by +19, and NASDAQ by +47.75.

Markets Around the World

  • Markets in the East closed mostly up – Tokyo and Seoul closed down.
  • European markets are mixed – Germany, the UK, Italy, and STOXX 600 are lower; France, Spain, and Switzerland are higher.
  • Currencies (Compared to two weeks ago):
Up Down
  • Dollar index
  • USD/CHF
  • USD/CAD
  • INR/USD
  • EUR/USD
  • GBP/USD
  • USD/JPY
  • AUD/USD
  • NZD/USD
  • Commodities (Compared to two weeks ago):
    • Energy futures are mixed.
    • 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 3.704, down -11.4 basis points from two weeks ago.
    • The 30-year is at 4.003%, down -10.5 basis points.
    • The 2-year yield is at 3.649%, down -29.5 basis points.
    • The 10-Year-&-2-Year spread is at 0.055, up from -0.126.
    • The 30-Year-&-10-Year spread is at 0.299, up from 0.290.
  • VIX
    • At 19.62 @ 8:15 AM; up from the last close; below the 5-day SMA
    • Recent high = 23.31 on September 4; low = 14.46 on August 19; Sentiment: Risk-Neutral-On

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

Weekly:
  • The week ending on September 6 was a large red candle with almost no upper and lower shadows. Closed down -4.6% below the all-time high of 5669.67.
    • Stochastic (9,1, 3): %K crossed below %D.
    • RSI-9 is just below 50.
  • The week was down -239.98 or 4.2%; the 5-week ATR is 181.19.
  • Second up week in the last five weeks and fifth in the previous ten weeks
  • The weekly pivot point=5478.31, R1=5554.00, R2=5699.58; S1=5332.73, S2=5257.04; S1/S2/S3 pivot levels were breached
  • Below 10-week EMA, but above 39-week SMA, and 89-week SMA
  • Uptrend Under Pressure
Daily
  • A green Harami candle with no lower shadow and a small upper shadow.
    • Stochastic (9, 1, 3): %K crossed above the %D from near zero.
    • RSI-9 has bounced above 40 but is still below the 8-day EMA.
  • Below 20-day EMA and 50-day EMA; above 100-day SMA and 200-day SMA.
  • Uptrend Under Pressure
2-Hour (E-mini futures)
  • Bouncing up after breaking below a trading range and after making a low of 5394.00 near the 161.8% retracement target around 5385.00.
    • RSI-21 is above 55.
    • At/above EMA20, but below the EMA10 of EMA50.
  • Bias: Down-Side
30-Minute (E-mini futures)
  • Moving sideways to up since 4:00 PM on September 9.
    • RSI-21 is just below 60.
    • Above EMA20, which is at/above EMA10 of EMA50.
  • Bias: Up-Side
15-Minute (E-mini futures)
  • The Bollinger Band (20, 2.0) has been moving up since 3:00 AM.
  • The Bollinger Band is expanding a little since 3:30 PM with price declining from the upper band to the lower band and bouncing up to the upper band again.
  • Bias: Side

Previous Session

Most major U.S. indices closed higher on Monday, September 9 in mixed volume. Dow Jones Industrial Average and Dow Jones Transportation Average traded in higher volume. The indices opened higher and then mostly traded higher. Most indices made Harami candlestick formation near the middle of Frida’s candles. All S&P sectors closed higher.

The dollar index closed up at 101.52, the energy futures closed mixed, the metals – precious and industrials – closed higher, and so did most soft commodities. The US Treasury yields closed lower as the bonds rose.

From Briefing.com

The stock market had a solid showing following last week’s broad retreat. The major indices exhibited some up and down action, but maintained gains through the entire session, ultimately selling near session highs.

[…]

Treasuries settled mixed after last week’s big gains, which acted as fuel for selling in the stock market. The 10-yr note yield settled one basis point lower at 3.70% and the 2-yr note yield settled two basis points higher at 3.67%.

[…]
  • S&P 500: +14.7% YTD
  • Nasdaq Composite: +12.5% YTD
  • Dow Jones Industrial Average: +8.3% YTD
  • S&P Midcap 400: +6.2% YTD
  • Russell 2000: +3.5% YTD

Reviewing today’s economic data:

  • July Wholesale Inventories 0.2% (Briefing.com consensus 0.3%); Prior 0.2%
  • Consumer credit increased by $25.5 billion in July (Briefing.com consensus $11.5 billion) after increasing a downwardly revised $5.2 billion (from $8.9 billion) in June.
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