Market Remarks

Morning Notes – Tuesday March 9, 2021

Sunil Sharma

Directional Bias For The Day:

  • S&P Futures are higher;
  • Futures rising since 3:30 PM on Monday after a choppy trading
  • The odds are for an up day with a good chance of sideways to down move from pre-open levels around 3855.00 – watch for a break above 3865.50 and below 3834.00 for clarity
  • No key economic data report due during the day:

Directional Bias Before Open:

  • Weekly: Uptrend
  • Daily: In Correction
  • 120-Min: Down-Side
  • 30-Min: Up-Side
  • 15-Min:  Up-Side
  • 6-Min: Side

Key Levels:

  • Critical support levels for S&P 500 are 3846.81, 3819.25, and 3804.30
  • Critical resistance levels for S&P 500 are 3865.02, 3881.06, and 3896.24
  • Key levels for E-mini futures: break above 3865.50, the high of 6:30 AM and break below 3834.00, the low of 2:00 AM

Pre-Open

  • On Monday at 4:00 PM, S&P futures (March 2021) closed at 3819.75 and the index closed at 3821.35 – a spread of about -1.75 points; futures closed at 3819.25 for the day; the fair value is +0.500
  • Pre-NYSE session open, futures are higher – at 7:30 AM, S&P 500 futures were up by +35.75; Dow by +124, and NASDAQ by +260.00

Markets Around The World

  • Markets in the East closed mostly higher
  • European markets are mostly higher
  • Currencies (from two weeks ago):
    Up Down
    • Dollar index
    • USD/JPY
    • USD/CHF
    • USD/CAD
    • EUR/USD
    • GBP/USD
    • AUD/USD
    • NZD/USD
    • INR/USD
  • Commodities (from two weeks ago):
    • Energy futures are mixed
    • Precious metals are lower
    • Industrial metals are lower
    • Most soft commodities are mostly lower
  • Treasuries (from two weeks ago)
    • 10-years yield closed at 1.596%, up 22.6 BP from two weeks ago;
    • 30-years is at 2.308%, up 12.8 BP;
    • 2-years yield is at 0.169%, up 5.6 BP;
    • The 10-Year-&-2-Year spread is at 1.427, up from 1.257
  • VIX
    • At 24.27 @ 6:45 AM; down from the last close; below 5-day SMA;
    • Recent high =  31.90 on March 4; low =  19.69 on February 10
    • Sentiment: Risk-On

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

Monthly
  • Confirmed Uptrend
  • December 2020 was a green candle with a small gap and with almost no upper and lower shadows; all-time closing and intraday highs;
    • Stochastic %K above %D near 100;
    • RSI-9 above 70; broke above a downtrend line from January 2018
    • Above the upper band of a 120-month regression channel;
  • The sequence of higher highs and higher lows is resumed
Weekly:
  • The week ending on March 5 was a Doji Harami candle
    • Stochastic (9,1, 3): %K is below %D but turning up
    • RSI (9) is near 60
  • The week was up +30.79 or +0.8%; the 5-week ATR is 125.66
  • An up week; third in the last five weeks, and sixth in the last ten weeks
  • The weekly week pivot point=3826.59, R1=3929.85, R2=4017.75; S1=3738.69, S2=3635.43; S1/R1 pivot levels were breached
  • At/above 10-week EMA, 39-week SMA, and 89-week SMA
  • Uptrend since March 23, 2020
Daily
  • A red candle with almost no lower shadow and an upper shadow slightly larger than the real body
    • Broke above a symmetrical triangle at 3550.00 level on November 9; the 100% extension target near 3900.00 is achieved; 161.8% extension target is near 4140.00 levels
    • %K  is above %D but turning down;
    • RSI-9 just below 50; turning up from below 40
  • Below 20-day EMA; above 50-day EMA, 100-day, and 200-day SMA
  • In Correction
2-Hour (E-mini futures)
  • Moving up since 12:00 PM on March 4; broke the sequence of lower highs and lower lows since making the all-time high on February 15; below the downtrend line from the all-time high; resuming up move after a brief 38.2% Fibonacci retracement
    • RSI-21 drifted sideways around 60 since 2:00 PM Friday
  • Above EMA20, which is above EMA10 of EMA50
  • Bias: Down-Side
30-Minute (E-mini futures)
    • Moving up since 3:30 PM on Monday after choppy trading since the week’s open
      • RSI-21 moving between 50 and 60
      • At/above EMA20, which is above EMA10 of EMA50
  • Bias: Up-Side
15-Minute (E-mini futures)
  • The Bollinger Band (20, 2.0) is moving sideways to up since 9:15 PM;
  • The Bollinger Band is slightly shrinking
    • Stochastic (9, 1, 3): %K is crisscrossing %D around 20
  • Bias: Up-Side

Previous Session

Major U.S. indices closed mixed on Monday, March 8 in lower volume. S&P 500, NASDAQ Composite, and Wilshire 5000 Total Market Index closed lower. The indices opened higher and climbed higher but declined in the afternoon. All but two S&P sectors -Technology and Healthcare – closed higher.

From Briefing.com:

The S&P 500 decreased 0.5% on Monday, as money continued to flow out of the heavily-weighted growth stocks and into value/cyclical stocks. The former group contributed to the 2.4% decline in Nasdaq Composite (-2.4%), while the latter helped lift the Dow Jones Industrial Average (+1.0%) to an intraday record high. The Russell 2000 gained 0.5%.

Seven of the 11 S&P 500 sectors closed in positive territory, but it was hard to overcome the continued growth-stock weakness within the information technology (-2.5%), communication services (-1.5%), and consumer discretionary (-0.2%) sectors. The health care sector (-0.3%) was clipped by its biotechnology components.

[…]

The 2-yr yield was unchanged at 0.15%. The U.S. Dollar Index advanced 0.5% to 92.42. WTI crude futures declined 1.6%, or $1.05, to $65.04/bbl.

Monday’s economic data was limited to Wholesale Inventories for January, which increased 1.3% m/m (Briefing.com consensus +1.3%) following a revised 0.6% increase in December (from 0.3%). Investors will not receive any notable economic data on Tuesday.

  • Russell 2000 +11.6% YTD
  • Dow Jones Industrial Average +3.9% YTD
  • S&P 500 +1.7% YTD
  • Nasdaq Composite -2.2% YTD
[…]
Exit mobile version