After the Close: September 14, 2023

Summary

Yesterday’s hotter-than-expected 3.7% inflation resulted in balanced two-sided trade in the market. Today, with the IPO of the semiconductor company ARM, and a mixed bag of economic results, the market broke out of yesterday’s balance range and rallied. In the afternoon trading, after the ES broke the ONH, the speed of the tape slowed and the ES started bouncing between a 10-point range of 4550-4560. The market seemingly couldn’t find enough buyers to rally to it’s next point of resistance at 4570, but it also didn’t trade below the ONH, which is also where VWAP currently is. SPY broke above and closed above $449, if we continue up and break $453.5, we will establish a daily up-trend (with higher highs and higher lows).

ES & NQ Sep 14, 2023
ES & NQ Sep 14, 2023

Economic

Core PPI came at expectation, 0.2%, while PPI was hotter than forecast, 0.7% vs 0.4%. Core retail sales came in stronger than expected, 0.6% vs 0.4%, signaling a resilient consumer. Unemployment claims remained steady at 220K (vs 226K forecast).

The CME FedWatch Tool is now predicting a 96% probability of no change to the interest rate during next week’s FOMC rate decision, and a 35% chance of a rate hike during the November 1 meeting. Furthermore, the today, and the stock was up 13.35% from the open.

S&P Sectors

Today’s biggest gains (from the open) came from the Real Estate, Utilities, Communication Services, and Consumer Staples sectors. The three largest sectors (XLK – Tech, XLV – Healthcare, XLF – Financials) were at the bottom of the list, with Healthcare actually down -0.25%.

S&P Sectors Sep 14, 2023
S&P Sectors Sep 14, 2023

Observations

  • Gold Futures (GC), once again broke the 1931 support level after the morning economic data was released. Rebounded, held above VWAP, and recovered the 1931 level which has once again become support.
  • ARM (ARM), rallied on it’s IPO day. Closed up 13.35% from the open.
  • Costco (COST), traded up to it’s daily resistance trendline and rejected it at $566.7
  • QQQ is respecting it’s weekly resistance down trendline – which multiple 1h candles failed to close above today.