Market Analysis (11 March’21)

Major U.S. stock-market benchmarks booked records on Thursday as U.S. Treasury yields steadied and as President Joe Biden signed a $1.9 trillion financial aid package to boost the economic recovery from the coronavirus pandemic.

TREND ANALYSIS

After today’s session, all four indices continue to be in an UPTREND on their daily timeframes. S&P500, Russell and Dow Jones are also in an UPTREND on their weekly and monthly timeframes.

FUTURES PRICE LEVELS

S&P500

The S&P500 index continued to rally today after investors’ demand for stocks — and particularly growth companies — has revived this week as bond markets have stabilized, with the yield on the 10-year U.S. Treasury note falling from an intraday high of 1.607% on Monday to 1.525% today. Hence, as a result of the renewed investor optimism, the S&P500 index rallied on Thursday towards its prior all time highs at the 3960 area. Should the index continue advancing in the coming sessions, it will reach the 4000 level for the first time ever.

ES, 1h

Nasdaq

The Nasdaq index has formed a bullish inverse Head and Shoulders pattern during the last several weeks. The index closed above the 13000 level today confirming its recent strength. The next important resistance (supply area) is located at the 13333 level.

NQ, 1h

FEAR INDICATOR

Prior to the February-March 2020 crash, the implied volatility indicator VIX has formed a triangle pattern with the base at 12%. It appears that the Fear Indicator is in the process of forming another similar pattern with the base implied volatility at 20%. Should the 20% support hold during the next several weeks / months, a new substantial spike in implied volatility might take place sometime late August / early September 2021.

VIX, daily

Leave a Reply