Morning Notes – Tuesday, July 25, 2023

/ July 25, 2023

Directional Bias For The Day:

  • S&P Futures are lower at 9:00 AM. Futures have been moving down since 4:30 AM – down more than 14 points.
  • The odds are for a sideways to a down day – watch for a break above 4590.50 or a break below 4579.75 for clarity
  • The major economic data reports due during the day:
    • HPI ( 0.7% vs. 0.6% est.; prev. 0.7%) at 9:00 AM
    • S&PO/CS Composite-20 HPI ( -1.7% vs. -2.3% est.; prev. -1.7%) at 9:00 AM
    • CB Consumer Confidence ( 112.1 est.; prev. 109.7) at 10:00 AM
    • Richmond Manufacturing Index ( -9 est.; prev. -7) at 10:00 AM

Directional Bias Before Open:

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

Key Levels:

  • Critical support levels for S&P 500 are 4547.46, 4535.79, and 4527.56
  • Critical resistance levels for S&P 500 are 4555.25, 4563.41, and 4574.66
  • The key levels for E-mini futures are 4590.50, the high at 8:00 AM, and 4579.75, the low at 9:45 PM

Pre-Open

  • On Monday at 4:00 PM, S&P futures (September 2023) closed at 4584.25, and the index closed at 4554.64 – a spread of about +29.75 points; the futures closed at 4583.50; the fair value is +0.75
  • Pre-NYSE session open, futures were mixed – at 9:00 AM, S&P 500 futures were down by -2.50, Dow down by -28, and NASDAQ up by +33.00

Markets Around The World

  • Markets in the East closed mostly higher – Tokyo and Mumbai closed lower
  • European markets are mixed – Germany, France, and Spain are down; the UK, Italy, Switzerland, and STOXX 600 are up
  • Currencies (Compared to two weeks ago):
Up Down
  • EUR/USD
  • AUD/USD
  • NZD/USD
  • Dollar index
  • GBP/USD
  • USD/JPY
  • USD/CHF
  • USD/CAD
  • INR/USD
  • Commodities (Compared to two weeks ago):
    • Energy futures are higher
    • Precious metals are higher
    • Industrial metals are higher
    • Soft commodities are higher
  • Treasuries (Compared to two weeks ago)
    • The 10-year yield closed at 3.912, down -9.4 basis points from two weeks ago;
    • The 30-year is at 3.949%, down -9.4 basis points
    • The 2-year yield is at 4.831%, down -2.0 basis points;
    • The 10-Year-&-2-Year spread is at -0.919, down from -0.845
    • The 30-Year-&-10-Year spread is at 0.037, unchanged
  • VIX
    • At 13.98 @ 8:45 AM; up from the last close; above the 5-day SMA;
    • Recent high = 21.33 on May 4; low = 12.73 on June 22
    • Sentiment: Risk-Off-Neutral

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

Weekly:
  • The week ending on July 21 was a green candle with almost no lower shadow and an upper shadow bigger than the real body just below a resistance level created by the high of the week of March 28, 2022.
    • Stochastic (9,1, 3): %K is crisscrossing the %D above 80;
    • RSI-9 is near75
  • The week was up +30.92 or +0.7%; the 5-week ATR  is 96.29
  • An up week, third in the last five weeks, and eight in the previous ten weeks;
  • The weekly pivot point=4539.89, R1=45741.88, R2=4613.42; S1=4501.35, S2=4466.36; R1 pivot level was breached
  • Above 10-week EMA and 39-week SMA; below 89-week SMA
  • Uptrend
Daily
  • A small green candle – forming a minor Falling Three Method

    • Stochastic (9, 1, 3): %K is crossing above %D;
    • RSI-9 is just above 70; below 8-DMA
  • Above 20-day EMA, 50-day EMA, 100-day SMA, and 200-day SMA;
  • Uptrend
2-Hour (E-mini futures)
  • Trending up since 2:00 AM on July 10 from a support level around 4410.00. Broke above a Symmetrical Triangle – the 161.8% extension target near 4590.00 is achieved. Drifting sideways to lower since reaching 4609.75 at 12:00 PM on July 19
    • RSI-21 declined to below 50
    • At/above EMA20, which is above EMA10 of EMA50
  • Bias: Up-Side
30-Minute (E-mini futures)
  • Drifting up since 2:00 AM – forming an up-sloping flag
    • RSI-21 is declining since 4:00 AM; below 50
    • Below EMA20, but at/above EMA10 of EMA50
  • Bias: Side-Up
15-Minute (E-mini futures)
  • The Bollinger Band (20, 2.0) has been moving sideways to down since 4:30 AM.
  • The Bollinger Band is expanding since 8:45 Am with the price walking down the lower band.
  • Bias: Side-Down

Previous Session

Major U.S. indices closed mostly higher on Monday, July 24, in lower volume. Dow Jones Transportation Average closed lower. The major indices opened up and then drifted higher for the rest of the day.

Print Friendly, PDF & Email

Related posts