Market Remarks

Morning Notes – Tuesday, March 18, 2025

Sunil Sharma

Directional Bias for the Day:

  • S&P Futures are lower. Breaking below a range between 5724.00 and 5705.00.
  • Odds are for a down day with elevated volatility and a good chance of moving sideways from the pre-open level around 5710.00.
  • The notable economic data due during the day:
    • Building Permits (1.46M vs. 1.45M est.; prev. 1.47M) at 8:30 AM.
    • Housing Starts (1.50M vs. 1.38M est.; prev. 1.35M) at 8:30 AM.
    • Import Prices (0.4% vs. -0.1% est.; prev. 0.4%) at 8:30 AM.
    • Capacity Utilization (78.2% vs. 77.8% est.; prev. 77.7%) at 9:15 AM.
    • Industrial Production (0.7% vs. 0.2% est.; prev. 0.3%) at 9:15 AM.
  • Weekly: Correction
  • Daily: Correction
  • 120-Min: Down-Side
  • 30-Min: Up-Side
  • 15-Min: Side-Down
  • 6-Min: Side-Down

Key Levels:

  • Critical support levels for the S&P 500 are 5586.68, 5546/09, and 5528.88.
  • Critical resistance levels for the S&P 500 are 5610.94, 5626.91, and 5642.19.
  • The key levels for E-mini futures are 5609.75, the high at 6:15 AM, and 5559.25, the low at 4:15 AM.

Pre-Open

  • On Monday at 4:00 PM, S&P futures (June 2025) closed at 5732.75, and the index closed at 5675.12 – a spread of about +57.75 points; the futures closed at 5731.25; the fair value is +1.50.
  • Pre-NYSE session open, futures were lower – at 9:00 AM, the S&P 500 futures were down by -29.00, Dow by -149 and NASDAQ by -145.75.

Markets Around the World

  • Markets in the East closed higher.
  • European markets are higher.
  • Currencies (Compared to two weeks ago):
Up Down
  • EUR/USD
  • GBP/USD
  • AUD/USD
  • NZD/USD
  • Dollar index
  • USD/JPY
  • USD/CHF
  • USD/CAD
  • INR/USD
  • Commodities (Compared to two weeks ago):
    • Energy futures are lower.
    • Precious metals are higher.
    • Industrial metals are higher.
    • Soft commodities are mainly higher.
  • Treasuries (Compared to two weeks ago)
    • The 10-year yield closed at 4.307, up +14.8 basis points from two weeks ago.
    • The 30-year is at 4.591%, up +13.9 basis points.
    • The 2-year yield is at 4.057%, up +9.9 basis points.
    • The 10-Year-&-2-Year spread is at 0.250, up from 0.201.
    • The 30-Year-&-10-Year spread is at 0.284, down from 0.293.
  • VIX
    • At 20.91 @ 8:15 AM; up from the last close; below the 5-day SMA.
    • Recent high = 29.57 on March 11; low = 17.67 on February 27.
    • Sentiment: Risk-Off

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

Weekly:
  • The week ending on March 14 was a relatively small red candle with almost no upper shadow and the lower shadow twice the size of the real body.
    • Stochastic (9,1, 3): %K is below %D.
    • RSI-9 is just above 30.
  • The week was down -1341.26 or -2.3%; the 5-week ATR is 210.94.
  • Fourth down week in the last five weeks and seventh in the previous ten weeks
  • The weekly pivot point=5616.32; R1=5727.99, 5817.04; S1=5527.27, S2=5415.60; S1 pivot level was breached
  • Below 10-week EMA; At/above 39-week SMA; above 89-week SMA
  • In Correction
Daily
  • A second green candle in a downtrend. The index has broken below the lower bound of a trading range between 6128.00 and 5775.00–the 61.8% extension target around 5550.00 is achieved; the 100% extension target is around 5400.00.
  • The index is below the lows of October 2024.
    • Stochastic (9, 1, 3): %K is above %D.
    • RSI-9 is just above 40 and above the 8-day EMA.
  • Below 20-day EMA, 50-day EMA, 100-day SMA, and 200-day SMA.
  • In Correction
2-Hour (E-mini futures)
  • Bouncing up since 2:00 PM om March 13 within a downtrend. Near the upper bound of a down-sloping regression channel.
    • RSI-9 has declined to just above 50 frm 65.
    • Above EMA20, which is above EMA10 of EMA50.
  • Bias: Down-Side
30-Minute (E-mini futures)
  • Moving sideways to down since 4:00 PM on Monday.
    • RSI-21 is around 45 and declining.
    • Below 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 sideways to down since 5:45 AM.
  • The Bollinger Band has been expanding a little since 6:30 AM with the price near the lower band.
  • Bias: Side-Down

Previous Session

Major U.S. indices closed higher on Monday, March 17 in lower volume. The markets in Europe and Asia also closed higher. The US indices opened flat and then after a brief decline drifted higher for the rest of the day.

The dollar index closed down; the energy and the precious metal futures closed mixed; the industrial metals closed up; and the soft commodities closed mainly higher. The US Treasuries yields were down, and the bonds were up. All S&P sectors closed up.

From Briefing.com

Today’s trade featured a positive bias through the entire session, reflecting an ongoing buy-the-dip mentality after the S&P 500 entered correction territory last week. Losses in the mega cap space limited index performance in the early going, but market breadth reflected more buying interest under the index surface. Advancers had a 4-to-1 lead over decliners at the NYSE and a 5-to-2 lead at the Nasdaq.

[…]

The 10-yr yield settled the session unchanged from Friday at 4.31% and the 2-yr yield settled three basis points higher at 4.05%.

  • Dow Jones Industrial Average: -1.7% YTD
  • S&P 500: -3.5% YTD
  • S&P Midcap 400: -4.8% YTD
  • Nasdaq Composite: -7.8%
  • Russell 2000: -7.3% YTD

Reviewing today’s economic data:

  • Retail sales increased 0.2% month-over-month in February (Briefing.com consensus 0.7%) following a downwardly revised 1.2% decline (from -0.9%) in January. Excluding autos, retail sales were up 0.3% month-over-month (Briefing.com consensus 0.4%) following a 0.6% decline (from -0.4%) in January.
  • The New York Fed’s Empire Manufacturing Survey for March showed the General Business Conditions Index declining to -20.0 in March from 5.7 in February. A number below 0.0 denotes a contraction in business activity in the New York Fed region. The Prices Paid Index rose five points to 44.9, its highest level in more than two years, while the Prices Received Index jumped three points to 22.4, hitting its highest level since May 2023.
  • January Business Inventories increased 0.3%, as expected, following a 0.2% decline in December.
  • The March NAHB Housing Market Index dropped to 39 (Briefing.com consensus 43) from 42 in February
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