Week of 1/28/2024 for SPX ES SPY

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The breakout discussed in last weekend’s post has not yet back tested. The market found short term balance this past week and awaits some additional information before making its next major move. This week provides more than enough of that information. We have earnings, FOMC, treasury issuance, jobs and a number of economic indices. The biggest catalyst that I’m watching (yes even more than earnings and FOMC) is the Treasury Refunding Announcement on Wednesday at 08:30AM EST. I alluded to some of the reason for this in the NQ/QQQ weekly bonus post, which can be seen HERE. Watching NQ/QQQ will be key with all of the tech earnings so keep eyes on even if trading ES/SPX/SPY or just watching both for managing trades on individual names.

Last week I had posted a free Markets Overview, seen HERE. Two of the highlights were RTY/IWM and Crude. I had proposed that if ZN saw upside continuation from it’s Friday hold of demand that risk appetite could increase, particularly benefiting RTY/IWM. You can see the move higher on ZN on Monday, and the corresponding move in RTY. From the Markets Overview post:

RTY From the post:

You can see the 3.2% move high from Friday’s close into Tuesday’s high. Also note the chop in both ZN and RTY following that move. If you were long RTY/IWM, you knew to close, hedge, or take profits in your position at resistance, particularly in the absence of continued strength in ZN.

I would definitely watch the reaction from ZN to the treasury announcement and FOMC decision. While earnings might move the market from one day to the next, I believe the treasury announcement will determine the course for the next 3 months.