MARCH 31, 2021
STOCKS – DIS, NKE, SQ
MACRO – SPY,
- Midday: To Rotate Or Not To Rotate, That Is The Question
- Morning Note – Quarter End
- MIDDAY: The Trading Range For The S&P 500 Is Near Its End One-Way Or Another
- Options Trades Suggest Micron Plunges Following Results
- Morning Note: Gold Says No Inflation
- Midday- Defensives Lead S&P 500
It was a buyers market on March 31, quite literally, with sellers absent until the final 30 minutes. Volumes across the market were very light, with the Qs and S&P e-minis trading with volumes well below the norm. There was quite literally an absence of sellers. Once the sellers showed up at the end of the day, the S&P 500 and Q dropped about 50 bps, with the S&P 500 giving-up more than half of its gains, rather fast, due to a massive $5.5 billion sell imbalance on the closing cross. It seemed the sellers were waiting for the end of the day.
The first day of the month has been a good one for equities since November, and except for January, every month’s first day has seen a rally. Tomorrow could be different for a few reasons: first, because we get the ISM data at 10 AM, and second because the market is closed on Friday, but the BLS job report will still be released.
A potential breakdown in the S&P 500 isn’t dead. The index did hit the upper trend line today, and that is where it failed. At this point, we could incur a few extra days of sideways trading if these levels hold or trade higher. However, the rising trendline off the March 2020 lows is the index’s biggest threat.
It was a good day for Square, but not good enough. The stock stalled and failed at resistance on the downtrend. The RSI still looks decent, so maybe the downtrend will lose.
Disney fell through the uptrend, and now it sits on support at $184.50. A break of support would send it down to $158. The RSI has been trending lower for a long-time and confirms a lower pattern.
Nike has struggled around the $145 level for a while. It nearly broke support at $131 but managed to snap back quickly. Probably suggesting the stock heads higher and test $145 one more time; we should know once it reaches $137.
Ok, well that’s all. There may not be another write-up until Monday. I will try before, but I am really looking forward to doing as little thinking as possible in the next few days.
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