Market Remarks

Morning Notes – Wednesday, February 5, 2025

Sunil Sharma

Directional Bias for the Day:

  • S&P Futures are lower at 8:45 AM; futures are moving up since 5:00 AM and are up more than 25 points.
  • Odds are for a down day with a good chance of sideways to a down move from the pre-open level around 6045.00 day. Watch for a break above 6053.00 or a break below 6020.25 for clarity.
  • The notable economic data due during the day:
    • ADP Non-Farm Employment Change (183K vs. 148K est.; prev. 176K) at 8:15 AM.
    • Trade Balance (-98.4B vs. -96.5B est.; prev. -78.8B) at 8:30 AM.
    • Final Services PMI (52.9 est.; prev. 52.8) at 9:45 AM.
    • ISM Services PMI (54.2 est.; prev. 54.1) at 10:00 AM.
  • Weekly: Uptrend
  • Daily: Uptrend Under Pressure
  • 120-Min: Down-Side
  • 30-Min: Side
  • 15-Min: Side
  • 6-Min: Side-Up

Key Levels:

  • Critical support levels for the S&P 500 are 5993.15, 5981.63, and 5969.65.
  • Critical resistance levels for the S&P 500 are 6041.74, 6051.97, and 6078.65.
  • The key levels for E-mini futures are 6053.00, the high at 8:15 PM, and 6020.25, the low at 5:00 AM.

Pre-Open

  • On Tuesday at 4:00 PM, S&P futures (March 2025) closed at 6062.50, and the index closed at 6037.88 – a spread of about +24.50 points; the futures closed at 6063.00; the fair value is -0.50.
  • Pre-NYSE session open, futures were down – at 8:30 AM, the S&P 500 futures were down by -23.25, Dow by -84 and NASDAQ by -141.75.

Markets Around the World

  • Markets in the East closed mixed – Hong Kong, Mumbai, and Singapore were down. Tokyo, Sydney, and Seoul closed up. Shanghai was closed.
  • European markets are mostly higher – France and Italy are lower.
  • Currencies (Compared to two weeks ago):
Up Down
  • GBP/USD
  • INR/USD
  • Dollar index
  • EUR/USD
  • USD/JPY
  • USD/CHF
  • AUD/USD
  • NZD/USD
  • USD/CAD
  • Commodities (Compared to two weeks ago):
    • Energy futures are lower.
    • Precious metals are higher.
    • Industrial metals are higher.
    • Soft commodities are mostly higher.
  • Treasuries (Compared to two weeks ago)
    • The 10-year yield closed at 4.510, down -7.2 basis points from two weeks ago.
    • The 30-year is at 4.749%, down -6.4 basis points.
    • The 2-year yield is at 4.216%, down -6.7 basis points.
    • The 10-Year-&-2-Year spread is at 0.294, down from 0.299.
    • The 30-Year-&-10-Year spread is at 0.239, up from 0.231.
  • VIX
    • At 17.39 @ 8:15 AM; up from the last close; above the 5-day SMA
    • Recent high = 22.51 on January 27; low = 14.90 on January 31; Sentiment: Risk-Off

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

Weekly:
  • A tear-drop green candle closing near the lows of previous week, a sign of weakness.
    • Stochastic (9,1, 3): %K crossed below %D. Potential Bearish Divergence.
    • RSI-9 dipped below 60. Potential Bearish Divergence.
  • The week was down -60.71 or -1.0%; the 5-week ATR is 174.98.
  • Third down week in the last five weeks and fifth in the previous ten weeks
  • The weekly pivot point=6041.45; R1=6119.99, 6199.44; S1=5962.00, S2=5883.47; S1 pivot level was breached
  • Above 10-week EMA; 39-week SMA, and 89-week SMA
  • Uptrend
Daily
  • A green candle with almost no upper and lower shadows at or below the upper bound of Monday’s down-gap.
    • Stochastic (9, 1, 3): %K crossed above %D.
    • RSI-9 has turned above 50; below the 8-day EMA.
  • Below 20-day EMA; above 50-day EMA; above 100-day SMA and 200-day SMA.
  • Uptrend Under Pressure
2-Hour (E-mini futures)
  • Bounced back up within – at the lower bound – an up-sloping regression channel after breaking below it on Monday. Essentially a sideways move since 2:00 PM on Monday.
    • RSI-9 is above 50.
    • At/above EMA20, which is below EMA10 of EMA50.
  • Bias: Down-Side
30-Minute (E-mini futures)
  • Moving within a range between 6068.75 and 6020.75 since 10:00 AM on Tuesday.
    • RSI-21 has been moving around 50.
    • Above EMA20, which is at/above EMA10 of EMA50.
  • Bias: Side
15-Minute (E-mini futures)
  • The Bollinger Band (20, 2.0) has been drifting sideways to up since 1:15 AM.
  • The Bollinger Band has been expanding since 6:15 AM with the price near the upper band..
  • Bias: Side

Previous Session

Major U.S. indices closed higher on Tuesday, February 4 in lower volume. The major indices opened higher and drifted higher for most of the day, though they still did break above the resistance of the upper bound of the Monday’s down-gap.

The dollar index and energy futures were down; metals – precious and industrials – were up; most of the soft commodities were up too. The US Treasury declined and the bonds advanced. The S&P sectors closed mixed – five up, four down, and one unchanged.

From Briefing.com

Today’s market showed a positive bias, with investor sentiment buoyed by several key developments related to tariffs and their potential impact on inflation and corporate earnings growth.

[…]

The S&P 500 logged a 0.7% gain and the Nasdaq Composite jumped 1.4%.

[…]

The 2-yr yield, at 4.24% before 10:00 ET, dropped five basis points from yesterday to 4.22%.

[…]
  • Dow Jones Industrial Average: +4.7% YTD
  • S&P Midcap 400: +3.1% YTD
  • Russell 2000: +2.7% YTD
  • S&P 500: +2.7% YTD
  • Nasdaq Composite: +1.8% YTD

Reviewing today’s economic data:

  • December Factory Orders -0.9% (Briefing.com consensus -0.3%); Prior was revised to -0.8% from -0.4%
  • December JOLTS – Job Openings 7.600 mln; Prior was revised to 8.156 mln from 8.098 mln
Exit mobile version