Morning Notes – Tuesday, April 16, 2024

/ April 16, 2024

Directional Bias for the Day:

  • S&P Futures are higher at 9:00 AM. Futures moving sideways to up since 3:00 PM within a narrow range.
  • The odds are for a sideways move within a trading range. Watch for a break above 5120.25 or a break below 5088.00 for clarity.
  • The major economic data report due during the day:
    • Building Permits (1.46M vs. 1.51M est.; prev. 1.52MM) at 8:30 AM.
    • Housing Starts (1.32M vs. 1.48M est.; prev. 1.55M) at 8:30 AM.
    • Industrial Production (0.4% vs. 0.4% est.; prev. 0.1%) at 9:15 AM.
    • Capacity Utilization (78.4% vs.78.5% est.; prev. 78.3%) at 10:00 AM.
  • Weekly: Up
  • Daily: Uptrend Under Pressure
  • 120-Min: Down
  • 30-Min: Down-Side
  • 15-Min: Side
  • 6-Min: Side

Key Levels:

  • Critical support levels for the S&P 500 are 5052.47, 5038.83, and 5000.52.
  • Critical resistance levels for the S&P 500 are 5083.43, 5107.94, and 5122.30.
  • The key levels for E-mini futures are 5120.25, the high at 7:45 AM, and 5088.00, the low at 6:15 AM.

Pre-Open

  • On Monday at 4:00 PM, S&P futures (June 2024) closed at 5103.25, and the index closed at 5061.82 – a spread of about +42.50 points; the futures closed at 5104.00; the fair value is -0.75.
  • Pre-NYSE session open, futures were higher – at 9:00 AM, the S&P 500 futures were up by +7.50, Dow by +234, and NASDAQ by +9.75.

Markets Around the World

  • Markets in the East closed lower.
  • European markets are lower.
  • Currencies (Compared to two weeks ago):
Up Down
  • Dollar index
  • USD/JPY
  • USD/CHF
  • USD/CAD
  • INR/USD
  • EUR/USD
  • GBP/USD
  • AUD/USD
  • NZD/USD
  • Commodities (Compared to two weeks ago):
    • Energy futures are mixed.
    • Precious metals are higher.
    • Industrial metals are higher.
    • Soft commodities are mostly lower.
  • Treasuries (Compared to two weeks ago)
    • The 10-year yield closed at 4.608, up +40.3 basis points from two weeks ago.
    • The 30-year is at 4.722%, up +37.6 basis points.
    • The 2-year yield is at 4.929%, up +29.7 basis points.
    • The 10-Year-&-2-Year spread is at -0.321, up from -0.427.
    • The 30-Year-&-10-Year spread is at 0.114, down 0.141.
  • VIX
    • At 18.76 @ 8:15 AM; down from the last close; above the 5-day SMA
    • Recent high = 22.07 on October 27, 2023; low = 14.59 on April 10; Sentiment: Risk-Neutral-Off

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

Weekly:
  • The week ending on April 12 was a red candle with small upper and lower shadows near 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 below the %D.
    • RSI-9 has declined to just above 60 from above 75.
  • The week was down -80.93 or -1.6%; the 5-week ATR is 105.79.
  • Third down week in the last five weeks and fifth in the previous ten weeks
  • The weekly pivot point=5152.05, R1=5196.17, R2=5268.92; S1=5079.30, S2=5035.18; S1 pivot level was breached
  • Above 10-week EMA, 39-week SMA, and 89-week SMA
  • Uptrend
Daily
  • A large red candle with almost no lower shadow and a small upper shadow. Just above a support level – the up-gap created on February 22.
  •  Broken below an upsloping channel since late October 2023.
    • Stochastic (9, 1, 3): %K is below the %D; near zero.
    • RSI-9 is below 40; below 8-day EMA.
  • Below 20-day EMA and above 50-day EMA; above 100-day SMA, and 200-day SMA.
  • Uptrend Under Pressure
2-Hour (E-mini futures)
  • Downtrend since March 31. Broke below several support levels. Next support level is around 5018.00.
    • RSI-21 has bounced up to near 40 from near 20 after making Bullish Divergence.
    • Below EMA20, which is below EMA10 of EMA50.
  • Bias: Down
30-Minute (E-mini futures)
  • Moving sideways to up since 3:00 PM on Mondary around 5110.00.
    • RSI-21 is just below 50 from near 25 and after making Bullish Divergence.
    • Above EMA20, but below EMA10 of EMA50.
  • Bias: Down-Side
15-Minute (E-mini futures)
  • The Bollinger Band (20, 2.0) has been moving sideways to up since 8:00 PM.
  • The Bollinger Band is expanding a bit since 6.30 AM with the price walking up the upper band.
  • Bias: Side

Previous Session

Major U.S. indices closed sharply lower on Monday, April 15 following another big decline on Friday in mostly higher volume. Russell 200 traded in lower volume. The major indices opened higher but immediately lost steam, turned down and traded lower for the rest of the day.

All S&P sectors closed lower. The dollar index, energy futures, precious metals. industrial metals, and most of the soft commodities closed higher. The bonds dropped and the US Treasury Yields rose.

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