Morning Notes – Wednesday, September 6, 2023

Sunil Sharma

1 year ago

Directional Bias For The Day:

S&P Futures are lower at 8:45 AM; moving sideways since 3:00 AM between 4496.00 and 4486.25
The odds are for a down day – watch for a break above 4501.00 for a change of sentiments
The major economic data report due during the day:
- Trade Balance ( -65.0B vs. -67.9B est.; prev. -63.7B) at 8:30 AM
- Final Services PMI ( 50.5 vs. 51.00 est.; prev. 51.0) at 9:45 AM
- ISM Services PMI ( 52.5 est.; prev. 52.7) at 10:00 AM
- Beige Book at 2:00 PM

Directional Bias Before Open:

Weekly: Uptrend Under Pressure
Daily: Uptrend
120-Min: Up

30-Min: Up-Side
15-Min: Side-Up
6-Min: Up

Key Levels:

Critical support levels for the S&P 500 are 4481.34, 4461.52, and 4438.15
Critical resistance levels for the S&P 500 are 4510.07, 4514.40, and 4534.55
The key levels for E-mini futures are 4501.00, the high at 1:45 AM and 4486.25, the low at 3:15 AM

Pre-Open

On Tuesday at 4:00 PM, S&P futures (September 2023) closed at 4502.25, and the index closed at 4496.83 – a spread of about +5.50 points; the futures closed at 4502.50; the fair value is -0.25
Pre-NYSE session open, futures were lower – at 8:30 AM, S&P 500 futures were down by -12.50, Dow by -101, and NASDAQ by -56.00

Markets Around The World

Markets in the East closed mixed – Shanghai, Tokyo, and Mumbai Closed higher; Hong Kong, Sydney, Seoul, and Singapore closed down
European markets are lower
Currencies (Compared to two weeks ago):

Up	Down
Dollar index USD/JPY USD/CHF AUD/USD NZD/USD	EUR/USD GBP/USD USD/CAD INR/USD

Commodities (Compared to two weeks ago):
- Energy futures are higher
- Precious metals are higher
- Industrial metals are mostly higher
- Soft commodities are mostly higher
Treasuries (Compared to two weeks ago)
- The 10-year yield closed at 4.2540, down -7.4 basis points from two weeks ago;
- The 30-year is at 4.358%, down -5.2 basis points
- The 2-year yield is at 4.957%, down -10.0 basis points;
- The 10-Year-&-2-Year spread is at -0.703, down from -0.729
- The 30-Year-&-10-Year spread is at 0.104, up from +0.082
VIX
- At 14.25 @ 8:15 AM; up from the last close; above the 5-day SMA;
- Recent high = 18.88 on August 18; low = 13.02 on September 1
- Sentiment: Risk-Off

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

Weekly:	The week ending on September 1 was a green candle with small upper and lower shadows Stochastic (9,1, 3): %K is above the %D; RSI-9 is above 60 The week was up +110.06 or +2.5%; the 5-week ATR is 119.13 Second up week in the last five weeks, and sixth in the previous ten weeks; The weekly pivot point=4490.67, R1=4566.35, R2=4616.94; S1=4440.08, S2=4364.40; R1/R2 pivot levels were breached Above 10-week EMA; 39-week SMA and 89-week SMA Uptrend Under Pressure
*Daily*	A relatively small red candle with almost no upper and lower shadows; a three-day EveningStar pattern is emerging at resistance around the 4550.00 level, which was created by a gap-down move on August 2. Stochastic (9, 1, 3): %K is below the %D RSI-9 is below 60; above 8-DMA Above 20-day EMA, 50-day EMA, 100-day SMA, and 200-day SMA; Uptrend
*2-Hour (E-mini futures)*	Moving down since 10:00 AM on September 1 making a rounding top pattern RSI-21 has moved down to just above 30 after making a Bearish Divergence on September 1 Below EMA20, which is below EMA10 of EMA50 Bias: Side-Down
*30-Minute (E-mini futures)*	Trending down since 9:30 AM on Friday RSI-21 has been moving around 40 since 3:30 PM on Tuesday At/below EMA20, which is below EMA10 of EMA50 Bias: Down
*15-Minute (E-mini futures)*	The Bollinger Band (20, 2.0) has been moving down since 3:45 PM. The Bollinger Band has been contracting since 7:15 AM Bias: Down

Previous Session

Major U.S. indices closed lower on Tuesday, September 5, in mixed volume. The Dow Jones Transportation Average and the Russell 2000 traded in higher volume.

The major indices opened lower and traded sidewyas for the rest of the day. All but three S&P sectors – Consumer Discretionary, Energy, and Technology – closed lower.