Client Portal

S&P Futures have started to stabilize ahead of today's FOMC minutes, but we see that S&P has carved out 5 waves lower from yesterday's intra-day highs. Thus, while a bounce is likely in short-term, (meaning 1 day) this doesn't make a convincing case of a bottom and points to the possibility of SPX testing and breaking 5829 into next week(^SPX-1.61%  ES-1.92% _F ) While both AAPL and NVDA should find firm footing at support on a bit further weakness into Friday/Monday, today's deterioration has likely given some good indication that S&P could actually temporarily break 5829 to the downside temporarily before rebounding into late Jan- I suspect a temporary bounce attempt to 5979-85 for ES-1.92% _F & this translates to 5940-50 for ^SPX-1.61%  cash. I am skeptical that 6021 is exceeded post FOMC minutes, this would be a positive "game-changer" but appears quite early to me

PPP doubled expectations today at 0.4%.. and the Annual PPI just surpassed CPI rate for the first time since 2022- Unemployment came in at 240k also about 20k higher, but traders are paying more attention to PPI as this is a leading indicator for Consumer Price inflation (Less so for Core PCE which is the indicator the Fed looks at) Given the confusing data between yesterday and today, there's enough to justify a data dependent stance from the Fed. Bond yields are higher by 0.02 bps while S&P Futures lower by -0.25%. Key levels traders will want to keep a close eye on revolve around Tuesday's lows at 6029.89 for ES (undercutting would be a mild negative and postpone rally) (This level is 6039.75 for ES-1.92% _F) while the ability to take out yesterday's highs in SPX at 6029.59 would be a green light for new highs. At present, not tooo much early morning volatility ahead of the bell but fractional weakness in both Stocks and Treasuries while DXY has continued its early week bounce as ECB cut for the 3rd time and data there looks weaker, resulting in EURUSD decline.

S&P has retraced between 50% -61.8% of the entire bounce from yesterday's lows, and this area, for those looking for tradable support, looks attractive - 5894-5900 in ES-1.92% _F (S&P December Futures) and the area near yesterday's lows will also be of paramount importance for ^SPX-1.61%  which is at 5855. if this area is broken, then this would invite further selling down into Thur/Friday before the bounce into Txgiving gets underway. Early market breadth is around 2/1 negative, with Staples the largest underperforming sector. Technology and Industrials round out the #2 and #3 worst performing this morning, while Energy, Materials, healthcare and Comm. Svcs are all positive. US Dollar is up around +0.50% while TNX is flat on the session.

Market update- So both QQQ along with S&P Futures (ES-1.92% _F) both undercut last Friday's lows by a brief amount before stabilizing and turning higher. This is a bullish signal that suggests our decline from 11/11 highs has temporarily run its course and should now give way to a counter-trend bounce which should take the shape of 3 waves and Carry QQQ up to 505, or potentially 508. However, i then suspect that markets will give way to additional weakness to new weekly lows given the extent of this damage from 11/11 into today, and feel that a move back to new highs won't happen right away. This means that the low to the correction from 11/11 will unfold as a giant ABC pattern but might bottom into 12/5-6... i.e in around 2 weeks time before a December push higher into year-end. I'll discuss NVDA thoughts in tonights report ahead of tomorrow, but it's absolutely vital that Technology start to work better sooner than later. For now, a tempoary low looks to be at hand.

S&P 500 Futures (hourly chart) show a very choppy range since the first week of October, and this recent consolidation might make sense given that investors are anxiously awaiting Tech earnings this week, with 5 of the 7 stocks representing the Magnificent 7 due to report this week, or roughly 12 Trillion in market cap. This amounts to around 1/4 of the entire market cap of the S&P 500, so it might make sense that earnings results might deliver an upside or downside surprise that should prove meaningful. The choppiness of this range does not provide a clear picture as it did last Friday morning given that prices pulled back sharply in the close. Until 5900 is exceeded in S&P December futures (ES-1.92% _F) one cant rule out weakness, but i don't expect 5800 is breached, and this broader pattern still is constructive from an Elliott-wave standpoint to bring about a move back to new highs into the first week of November in all likelihood.

Powell's lack of urgency to cut too quickly has caused some flattening in the yield curve today.. 2 yr yields rose to session highs, along with US Dollar which rose the most vs Yen (+1.0%). Powell said in prepared remarks "Fed doesn't feel like it's in a hurry to cut quickly" and i think it's safe to say that a strong economy where Powell dials in some of the enthuasiasm for rate cuts, largely is good for Stocks, vs the early part of the year, where economic disappointment resulted in strength for Equities. This recent consolidation in stocks over the last week is more bullish than bearish, given the breakouts we've seen in Materials, Discretionary, and Industrials, despite some lagging in Financials and Healthcare. After a 500 point S&P Move in a period of two weeks from 9/6 into 9/19, it's natural for ^SPX-1.61%  to show some consolidation. Moreover, moving sideways is not too big of a deal if key constituent SPX, and QQQ stocks like AAPL-2.25%  are breaking out and showing good strength. This hourly chart shows our 500 point move the 2nd and 3rd week of Sept and the subsequent range-bound position that stocks have moved sideways in since. Above 5830 would cause acceleration higher for S&P Futures (ES-1.92% _F ) and that same area for ^SPX-1.61%  lies at 5764

Good bounce today and market breadth is better today as a positive than it was late last week as a negative. Yet as can be seen, more progress is needed to have real confidence that we might have bottomed and as of now, that can't be said. Not much volatility today in DXY nor TNX.. Precious metals making small bounce. Good to see five sectors up more than 1% today: Financials, Discretionary, Industrials, Healthcare and Technology, but this rally will be a work in progress. 5508 important for S&P Futures, while 5440 support, than 5428 and Can't afford to slip under 5428 without a retest and possible break of last Friday's lows (ES-1.92% _F ^SPX-1.61%  )

This is my S&P projection over the next few weeks. Initially i expect a push back to marginal new highs, which should be followed by a late month correction. Tough to know the exact highs, but expect 5675-5750 area into FOMC and then we finally have a more meaningful consolidation. However, i do not expect August lows to be broken, and this should prove short-lived and not too damaging to the broader structure ( ^SPX-1.61%  ES-1.92% _F )

US equities have been churning this morning and NASDAQ 100 futures (shown below) along with SPX & DJIA are right near the highs of the last couple days. No real conviction on short-term direction but hourly closes over 18651 for NQ_F or above 5372 for ES-1.92% _F (Futures for NASDAQ and S&P) would result in upward continuation for today. I sense that the current strength of any advance might lack the power to break downtrends ahead of next week's CPI, but it remains correct to be bullish and simply look to buy any dips which happen into next week, with trends expected to push higher into September. Treasury yields and US Dollar have pulled back this morning. Sectors like Financials, Tech, and Communication Svcs are the three that are higher by more than +0.25% today, while Industrials and Utilities are lagging.

Today's Jobless claims come in 233k v 240, or nearly the most in a year, helping to ease the fears which began last Friday of a labor mkt meltdown as of now. S&P Futures jump +0.88% and NASDAQ futures higher by +1.25% while Treasury yields, US Dollar shows mild gains. I am bullish for further gains, but its going to be important for S&P to get OVER yesterdays highs initially to be able to drive this advance materially higher and this is the first real important area to keep an eye on. This lies at 5359 for ES-1.92% _F and 5330 for SPX cash. Above that should boost prices up to 5405 in SPX cash and 5435 in Futures