Market Remarks

Morning Notes – Tuesday, April 25, 2023

Sunil Sharma

Directional Bias For The Day:

  • S&P Futures are lower at 9:00 AM – trending down since 4:00 Pm on Monday, forming an upsloping flag since 4:15 AM
  • The odds are for a sideways to a down day – watch for a break above 4148.50 and a break below 4130.00 for clarity.
  • The major economic data reports due during the day:
    • HPI ( 0.5% vs. -0.1% est.; prev. 2.6%) at 9:00 AM
    • S&P/CS Composite-20 HPI ( 0.4% vs. -0.1% est.; prev. 2.6%) at 9:00 AM
    • CB Consumer Confidence ( 104.1 est.; prev. 104.2) at 10:00 AM
    • New Home Sales ( 633K est.; prev. 640K) at 10:00 AM
    • Richmond Manufacturing Index ( -8 est.; prev. -5) at 10:00 AM

Directional Bias Before Open:

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

Key Levels:

  • Critical support levels for S&P 500 are 4113.20, 4099.40, and 4086.94
  • Critical resistance levels for S&P 500 are 4142.41, 4148.57, and 4162.57
  • The key levels for E-mini futures are a break above 4148.50, the high at 2:00 AM, and a break below 4130.00, the low at 4:15 AM

Pre-Open

  • On Monday at 4:00 PM, S&P futures (June 2023) closed at 4160.50, and the index closed at 4137.04 – a spread of about +23.50 points; the futures closed at 4159.50; the fair value is -1.00
  • Pre-NYSE session open, futures were lower – at 8:45 AM, S&P 500 futures were down by -17.75, Dow by -68, and NASDAQ by -51.25

Markets Around The World

  • Markets in the East closed mostly lower – Tokyo and Mumbai were up, and Sydney was closed
  • European markets are mostly lower – Switzerland is higher
  • Currencies (Compared to two weeks ago):
Up Down
  • EUR/USD
  • GBP/USD
  • USD/JPY
  • AUD/USD
  • USD/CAD
  • Dollar index
  • USD/CHF
  • NZD/USD
  • INR/USD
  • Commodities (Compared to two weeks ago):
    • Energy futures are mixed
    • Precious metals are mixed
    • Industrial metals are mostly higher
    • Soft commodities are mixed
  • Treasuries (Compared to two weeks ago)
    • The 10-year yield closed at 3.426, up +1.1 basis points from two weeks ago;
    • The 30-year is at 3.666%, up +4.0 basis points;
    • The 2-year yield is at 4.090%, up +7.4 basis points;
    • The 10-Year-&-2-Year spread is at -0.664, down from -0.601
    • The 30-Year-&-10-Year spread is at 0.240, up from +0.211
  • VIX
    • At 17.53 @ 8:30 AM; up from the last close; above the 5-day SMA;
    • Recent high = 25.21 on March 24; low = 16.14 on November 4, 2021
    • Sentiment: Risk-Off

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

Weekly:
  • The week ending on April 21 was a small Doji candle following another Doji candle.
    • Stochastic (9,1, 3): %K is above the %D;
    • RSI-9 is just above 60
  • The week was down -4.12 or -0.1%; the 5-week ATR  is 99.82
  • A down week, second in the last five weeks, and fifth in the previous ten weeks;
  • The weekly pivot point=4138.95, R1=4164.05, R2=4194.57; S1=4108.43, S2=4083.33; No pivot levels were breached
  • Above 10-week EMA and 39-week SMA; below 89-week SMA
  • Uptrend
Daily
  • A small Doji candle after a couple of small Doji candles
    • Stochastic (9, 1, 3): %K is crossing above the %D
    • RSI-9 is just above 60; below 8-DMA
  • Above 20-day EMA, 50-day EMA, 100-day SMA, and 200-day SMA;
  • Uptrend
2-Hour (E-mini futures)
  • Moving sideways to down after breaking below an up-sloping flag, which had been in effect since 2:00 PM on March 9, at 2:00 PM on April 19
    • RSI-21 has again declined to 40 from above 60 at 8:00 AM on Monday
    • Below EMA10 of EMA50, which is below EMA20
  • Bias: Up-Side
30-Minute (E-mini futures)
  • Drifting lower since 8:30 AM on April 18, making lower highs and lower lows
    • RSI-21 is near 45
    • At/below EMA 20, which is below EMA10 of EMA50
  • Bias: Side-Down
15-Minute (E-mini futures)
  • The Bollinger Band (20, 2.0) has been moving down since 4:30 PM on Monday.
  • The Bollinger Band has been contracting a bit.
  • Bias: Side-Down

Previous Session

Major U.S. indices closed mostly higher on Monday, April 24, in lower volume. NASDAQ Composite and Russell 2000 closed lower.

The major indices opened flat and moved up, then declined, and then again advanced to close with little change from the previous day’s close.

From Briefing.com:

[…]

The Vanguard Mega Cap Growth ETF (MGK) was down 0.2% while the Invesco S&P 500 Equal Weight ETF (RSP) rose 0.2% and the market-cap weighted S&P 500 was up 0.1%.

Roughly half of the S&P 500 sectors logged a gain led by energy (+1.5%),

[…]

At the close, advancers led decliners by a slim margin at the NYSE while decliners outpaced advancers by a 13-to-9 margin at the Nasdaq.

[…]

The 2-yr note yield fell three basis points to 4.13% and the 10-yr note yield fell six basis points to 3.52%.

  • Nasdaq Composite: +15.0% YTD
  • S&P 500: +7.8% YTD
  • S&P Midcap 400: +2.8% YTD
  • Dow Jones Industrial Average: +2.2% YTD
  • Russell 2000: +1.6% YTD
[…]

Overseas: 

  • Europe: DAX -0.1%, FTSE -0.0%, CAC -0.0%
  • Asia: Nikkei +0.1%, Hang Seng -0.6%, Shanghai -0.8%

Commodities: 

  • Crude Oil +0.85 @ 78.71
  • Nat Gas +0.03 @ 2.25
  • Gold +8.70 @ 1999.80
  • Silver +0.20 @ 25.29
  • Copper -0.03 @ 3.95
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