Market Remarks

Morning Notes – Tuesday April 13, 2021

Sunil Sharma

Directional Bias For The Day:

  • S&P Futures are little changed
  • Futures are volatile and have moved between  4127.00 and 4101.00 in pre-market trading
  • The odds are for a down to sideways day with volatility – watch for a break above 4127.00 for clarity
  • Key economic data report due during the day:
    • CPI ( 0.6% vs. 0.5% est.; prev. 0.4%) at 8:30 AM
    • Core CPI ( 03% vs. 0.2% est.; prev. 0.1%) at 8:30 AM

Directional Bias Before Open:

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

Key Levels:

  • Critical support levels for S&P 500 are 4118.21, 4107.70, and 4097.15
  • Critical resistance levels for S&P 500 are 4131.76, 4141.80, and 4151.83
  • Key levels for E-mini futures: break above 4127.00, the high of 6:00 AM and break below 4101.25, the low of 7:00 AM

Pre-Open

  • On Monday at 4:00 PM, S&P futures (June 2021) closed at 4121.00 and the index closed at 4127.99 – a spread of about -7.00 points; futures closed at 4120.25 for the day; the fair value is +0.75
  • Pre-NYSE session open, futures are mixed – at 8:15 AM, S&P 500 futures were down by -10.00; Dow down by -113, and NASDAQ up by +10.75

Markets Around The World

  • Markets in the East closed mostly higher – Shanghai closed lower;
  • European markets are mostly higher – The UK, Spain, and Switzerland are down
  • Currencies (from two weeks ago):
    Up Down
    • EUR/USD
    • USD/CAD
    • INR/USD
    • Dollar index
    • GBP/USD
    • USD/JPY
    • USD/CHF
    • AUD/USD
    • NZD/USD
  • Commodities (from two weeks ago):
    • Energy futures are lower
    • Precious metals are higher
    • Industrial metals are mixed
    • Most soft commodities are mostly higher
  • Treasuries (from two weeks ago)
    • 10-years yield closed at 1.675%, down -4.6 basis points from two weeks ago;
    • 30-years is at 2.347%, down -7.7 basis points;
    • 2-years yield is at 0.165%, up +2.4 basis points;
    • The 10-Year-&-2-Year spread is at 1.510, down from 1.580
  • VIX
    • At 17.30 @ 7:45 AM; up from the last close; above 5-day SMA;
    • Recent high =  23.55 on March 25; low =  16.20 on April 9
    • Sentiment: Risk-Off

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

Monthly
  • Confirmed Uptrend
  • March 2021 was a green candle with a small upper shadow and a lower shadow almost equal to the real body; at all-time closing and intra-month highs;
    • Stochastic %K above %D near 100;
    • RSI-9 near 75; 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 April 9 was a green candle breaking away from previous weeks; almost no upper and lower shadows; at all-time highs
    • Stochastic (9,1, 3): %K is above %D; near 100
    • RSI (9) is near 75
  • The week was up +108.93 or +2.7%; the 5-week ATR is 109.96
  • An up week; fourth in the last five weeks, and seventh in the last ten weeks
  • The weekly week pivot point=4160.71, R1=4192.61, R2=4255.75; S1=4065.67, S2=4002.53; R1/R2/R3 pivot levels were breached
  • Above 10-week EMA, 39-week SMA, and 89-week SMA
  • Uptrend since March 23, 2020
Daily
  • A small Doji candle that moved sideways from the previous close; at all-time intraday and closing highs
    • 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 crossing below %D; near 100
    • RSI-9 is near 80; above 8-day EMA
  • Above 20-day EMA, 50-day EMA, 100-day, and 200-day SMA
  • Uptrend
2-Hour (E-mini futures)
  • Trending up since 10:00 AM on March 25; at all-time highs;  sideways since 2:00 PM on Friday; sharp decline since 6:00 AM
    • Broke above a down-sloping flag on March 26; the 100% extension target near 4100.00 is achieved;
    • RSI-21 is fallen below 50; made few Bearish Divergences in the last few days
  • Below EMA20, but above EMA10 of EMA50
  • Bias: Up
30-Minute (E-mini futures)
  • Moving sideways since 4:00 PM on Friday above a support line which was a resistance-level before
    • RSI-21 declined below 40; Bearish Divergence at 5:30 AM
    • Below EMA10 of EMA50, which s below EMA 20
  • Bias: Up-Side
15-Minute (E-mini futures)
  • The Bollinger Band (20, 2.0) is moving sideways since 9:15 PM on Sunday
  • The Bollinger Band is expanding since 6:45 AM with price walking down the lower bound
    • Stochastic (9, 1, 3): %K is crisscrossing %D higher from below 10
  • Bias: Up-Side

Previous Session

Major U.S. indices closed mostly lower on Monday, April 12 in mixed volume. Dow Jones Transportation Average and NYSE Composite closed higher. Dow Jones Industrial Average and Dow Transports in higher volume. Indices mostly traded within a narrow range during the day.

From Briefing.com:

The S&P 500 (-0.02%) eked out an intraday record high on Monday, but it closed fractionally lower in a tight-ranged session as investors waited for Q1 earnings and economic data later in the week. The Nasdaq Composite (-0.4%), Dow Jones Industrial Average (-0.2%), and Russell 2000 (-0.4%) joined the benchmark index with modest losses.

Eight of the 11 S&P 500 sectors closed higher, although daily gains were capped at 0.6% (consumer discretionary). The information technology (-0.5%) and communication services (-0.6%) sectors dragged on the index performance amid a breather in their heavily-weighted components while the energy sector (-0.9%) was the weakest link.

[…]

The 2-yr yield increased one basis point to 0.17%, and the 10-yr yield increased one basis point to 1.68%. The U.S. Dollar Index was little changed at 92.12. WTI crude futures increased 0.7%, or $0.40, to $59.69/bbl.

[…]
  • Russell 2000 +13.1% YTD
  • Dow Jones Industrial Average +7.5% YTD
  • S&P 500 +9.9% YTD
  • Nasdaq Composite +7.5% YTD

Overseas: 

  • Europe: DAX -0.1%, FTSE -0.4%, CAC -0.1%
  • Asia: Nikkei -0.8%, Hang Seng -1.0%, Shanghai -1.1%

Commodities: 

  • Crude Oil +0.26 @ 59.51
  • Nat Gas +0.03 @ 2.56
  • Gold -12.20 @ 1732.80
  • Silver -0.44 @ 24.86
  • Copper -0.03 @ 4.02
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