Morning Notes – Thursday, April 18, 2024

/ April 18, 2024

Directional Bias for the Day:

  • S&P Futures are higher at 8:30 AM but moving within a trading range between 5084.25 and 5063.75 since 9:45 PM.
  • The odds are for a sideways to an up day – watch for a break above 5084.25 or a break below 5063.75 for clarity.
  • The major economic data report due during the day:
    • Unemployment Claims (212K vs. 215K est.; prev. 212K) at 8:30 AM.
    • Philly Fed Manufacturing Index (15.5 vs. 1.5 est.; prev. 3.2) at 8:30 AM.
    • Existing Homes (4.20M est.; prev. 4.38M) at 10:00 AM
    • CB Leading Index (-0.1% est.; prev. 0.1%) at 10:00 AM.
  • Weekly: Up
  • Daily: Uptrend Under Pressure
  • 120-Min: Down
  • 30-Min: Down-Side
  • 15-Min: Down-Side
  • 6-Min: Side

Key Levels:

  • Critical support levels for the S&P 500 are 5022.72, 5007.25, and 5000.52.
  • Critical resistance levels for the S&P 500 are 5033.77, 5055.51, and 5079.84.
  • The key levels for E-mini futures are 5079.25, the high at 7:45 AM, and 5063.75, the low at 5:50 AM.

Pre-Open

  • On Wednesday at 4:00 PM, S&P futures (June 2024) closed at 5060.75, and the index closed at 5022.21 – a spread of about +40.50 points; the futures closed at 5062.25; the fair value is +0.50.
  • Pre-NYSE session open, futures were higher – at 8:00 AM, the S&P 500 futures were up by +12.50, Dow by +89, and NASDAQ by +50.75.

Markets Around the World

  • Markets in the East closed mostly higher – Mumbai closed down.
  • European markets are mostly higher – Switzerland is 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 lower.
    • 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 4.593, up +23.8 basis points from two weeks ago.
    • The 30-year is at 4.705%, up +19.8 basis points.
    • The 2-year yield is at 4.945%, up +26.4 basis points.
    • The 10-Year-&-2-Year spread is at -0.352, up from -0.326.
    • The 30-Year-&-10-Year spread is at 0.112, down 0.152.
  • VIX
    • At 17.81 @ 7:45 AM; down from the last close; above the 5-day SMA
    • Recent high = 19.56 on April 16; 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 Bearish Engulfing candle following a small Doji like red candle. Broke below a support level around 5038.83 – the up-gap created on February 22. The next support level is around 4920.31, the swing low created on February 13.
    • Stochastic (9, 1, 3): %K crossed above the %D, which fell more; just above zero.
    • RSI-9 is below 30; 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 is just above 40.
    • Below EMA20, which is below EMA10 of EMA50.
  • Bias: Down
30-Minute (E-mini futures)
  • Moving sideways to up since 11:00 AM on Wednesday around 5110.00.
    • RSI-21 has been moving around 50.
    • At/above EMA20, which is below EMA10 of EMA50.
  • Bias: Down-Side
15-Minute (E-mini futures)
  • The Bollinger Band (20, 2.0) has been moving down since 5:00 AM after moving up since 8:30 PM.
  • The Bollinger Band is relative stable.
  • Bias: Down-Side

Previous Session

Major U.S. indices closed lower on Wednesday, April 17 in mixed volume. Dow Jones Industrial Average and Russell 200 traded in lower volume. The major indices opened flat and then traded lower for most of the day with a feeble attempt to bounce in afternoon. Most have broken a support level formed by the large upside move on February 22.

All but four S&P sectors – Staples, Materials, Financials, and Utilities – closed lower. The dollar index and energy futures closed lower; precious metals closed mixed. industrial metals, and most of the soft commodities closed lower. The bonds gained a little and the US Treasury Yields declined.

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