E-mini S&P (March)
Yesterday’s close: Settled at 3243.50, up 8.00
Fundamentals: U.S benchmarks shook off Middle East tensions and surged higher on the opening bell yesterday. The S&P turned positive by noon and extended gains into the close. Price action remains firm at the onset of U.S hours despite threats of retaliation by Iran for the killing of its general. The country says it is currently assessing 13 scenarios to wreak havoc on America. Although the threat of escalation is ever-present, we stand by the comments we made in our Crude Oil section Friday, “The most likely outcome as of right now are ongoing, but yes dangerous, clashes between Iran-backed and U.S forces.” Traders must be prepared for the market to react and volatility to increase due to skirmishes in the headlines and the jawboning of such.
Yesterday, big tech led the way with Alphabet, Netflix, Facebook and Amazon all gained 1.5% or more. Apple and Microsoft also finished in the green. Small Oil and Gas also notched a strong session. Salesforce gained 4.38% as it attempts to breakout. Bill Baruch joined CNBC’s Trading Nation on Friday and Salesforce (CRM) was his top pick amid a potentially uncertain landscape.
Today’s economic calendar will be pivotal, either providing stable footing for the market to extend gains or softening sentiment. Eurozone CPI this morning was in line with expectations, but Retail Sales firmly beat. U.S Trade Balance data is due at 7:30 am CT before the Factory Orders and the closely watched ISM Non-Manufacturing at 9:00 am CT. There is a 3-year Note auction at noon CT.
Technicals: Price action is holding firm out above our Pivots which align multiple levels including our momentum indicators this morning; the path of least resistance is higher while holding above here. Still, there is a ceiling of previous highs and previous high closes overhead aligning to create a wave of major three-star resistances that the tape must chew through in order to ignite the next leg higher. First key support levels come in at 3230-3231.50 and 8810-8817; a break below here will neutralize yesterday’s rally and potentially encourage a wave back down to those lows.
Resistance: 3248.50-3254***, 3259-3264***, 3295-3300***
Support: 3230.50-3231.50**, 3210.75-3213**, 3200-3204.25***, 3188.25-3190***, 3167.25-3175.25***
Resistance: 8891.75-8919.75***, 8995.50***
Support: 8810-8817**, 8766.25*, 8735.25**, 8673.50-8691.25***, 8632.50**, 8593.25***, 8521-8547.75***