Morning Notes – Wednesday, March 13, 2024

/ March 13, 2024

Directional Bias for the Day:

  • S&P Futures are lower at 9:00 AM. The futures are moving between 5246.75 and 5235.00 since 3:00 PM on Tuesday.
  • The odds are for a sideways to a down day with elevated volatility – watch for a break above 5246.75 and a break below 5235.00 for clarity.
  • No major economic data report is due during the day:
  • Weekly: Up
  • Daily: Uptrend
  • 120-Min: Up
  • 30-Min: Up-Side
  • 15-Min: Side
  • 6-Min: Side

Key Levels:

  • Critical support levels for the S&P 500 are 5162.91, 5143.18, and 5114.48.
  • Critical resistance levels for the S&P 500 are 5179.87, 5189.26, and 5198.60.
  • The key levels for E-mini futures are 5246.75, the high at 3:45 PM on Tuesday, and 5235.00, the low at 11:15 PM.

Pre-Open

  • On Tuesday at 4:00 PM, S&P futures (June 2024) closed at 5241.50, and the index closed at 5175.27 – a spread of about +66.25 points; the futures closed at 5241.25; the fair value is +0.50.
  • Pre-NYSE session open, futures were mixed – at 8:45 AM, the S&P 500 futures were down by -2.50, Dow up by +22, and NASDAQ down by -53.75.

Markets Around the World

  • Markets in the East closed mixed – Shanghai, Hong Kong, Tokyo, and Mumbai closed down; Sydney, Seoul, and Singapore closed higher.
  • European markets are mostly higher – Germany and the UK are lower.
  • Currencies (Compared to two weeks ago):
Up Down
  • EUR/USD
  • GBP/USD
  • AUD/USD
  • Dollar index
  • USD/JPY
  • USD/CHF
  • NZD/USD
  • USD/CAD
  • INR/USD
  • Commodities (Compared to two weeks ago):
    • Energy futures are mixed.
    • Precious metals are higher.
    • Industrial metals are higher.
    • Soft commodities are mostly higher.
  • Treasuries (Compared to two weeks ago)
    • The 10-year yield closed at 4.192, down -12.3 basis points from two weeks ago.
    • The 30-year is at 4.353%, down -8.8 basis points.
    • The 2-year yield is at 4.586%, down -10.1 basis points.
    • The 10-Year-&-2-Year spread is at -0.394, down from -0.372.
    • The 30-Year-&-10-Year spread is at 0.161, up from +0.126.
  • VIX
    • At 13.78 @ 8:30 AM; below from the last close; below the 5-day SMA
    • Recent high = 16.04 on March 11; low = 13.08 on March 1; Sentiment: Risk-Neutral

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

Weekly:
  • The week ending on March 8 was a small Doji candle at the all-time highs.
  • Broke above a down-sloping Flag on November 14 – the 100% extension target around 4901.00 is achieved, and the 161.8% extension target is near 5395.00.
    • Stochastic (9,1, 3): %K is crossed below the %D from near 100.
    • RSI-9 is above 80.
  • The week was down -13.39 or -0.3%; the 5-week ATR is 124.12.
  • Second down week in the last five weeks and third in the previous ten weeks
  • The weekly pivot point=5123.26, R1=5189.69, R2=5255.70; S1=5057.25, S2=4990.82; R1S1 pivot levels were breached
  • Above 10-week EMA, 39-week SMA, and 89-week SMA
  • Uptrend
Daily
  • A green candle with almost no upper shadow and a small lower shadow closing at an all-time high.
    • Stochastic (9, 1, 3): %K crossed above the %D.
    • RSI-9 turned up above 65; above 8-day EMA.
  • Above 20-day EMA; above 50-day EMA, 100-day SMA, and 200-day SMA – in sequence.
  • Uptrend
2-Hour (E-mini futures)
  • Moving higher within an upsloping Linear Regression channel of one StdDev since mid-January – the price has crossed above the middle band of the channel.
    • RSI-21 has declined to below 60 from above 70 on Tuesday.
    • Above EMA20, which is above EMA10 of EMA50.
  • Bias: Up
30-Minute (E-mini futures)
  • Moving sideways since 2:30 PM on Tuesday between 5247.50 and 5235.00.
    • RSI-21 has declined to just above 50 after making a few Bearish Divergences over the past couple of days.
    • Below EMA20, but above EMA10 of EMA50,
  • Bias: Up-Side
15-Minute (E-mini futures)
  • The Bollinger Band (20, 2.0) has been moving sideways to up since 8:30 PM.
  • The Bollinger Band is relatively narrow and stable.
  • Bias: Side

Previous Session

Major U.S. indices closed mostly higher on Tuesday, March 12 in higher volume. Major indices opened higher and after the initial drop in the first half hour of trading they mostly traded higher for the rest of the day. Russell 2000 closed lower. S&P 500, NYSE Composite, and Wilshire 5000 Total Market index closed at all-time highs.

All but four S&P sectors – Energy, Materials, Utilities, and Real Estate – closed higher. The dollar index closed higher. Energy futures and precious metals closed down. The industrial metals and the soft commodities closed mostly higher. The bonds closed down, i.,e., the US Treasury Yields closed higher.

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