Focus Stays on Banks & Turns to Fed

FRC is down hard, while the Fed meeting is on watch.

Technical Edge — 

• NYSE Breadth: 15% Upside Volume (!)

• Advance/Decline: 15% Advance (!)

• VIX: ~$24.25

We come into the week with a “take-under” of Credit Suisse and First Republic Bank (FRC) down about 18% on the session. 

I want to really focus on two sectors this week: Tech and Banks (more on that below).

The banks ended the week near the lows, which is not a great sign. But on the flip side, the banks — and particularly semiconductors — churned out powerful gains. 

On the one hand, it makes some sense right? MSFT, AAPL, GOOGL, etc. have fortress balance sheets and robust cash flows. In some ways, that’s the “safety trade” right now. 

That said, we have pure robust relative strength in the group. NVDA rallied all five days last week. AMD climbed 18% last week. There’s no denying that this is where the strength is. 

S&P 500 — ES 

The ES has been all over the place. Now flattish as of 8:00 ET, it was up 30+ handles at one point and down 50 points at another.

It continues to pound out support in the ~3900 area, but continues to make lower highs. 

• Downside levels: 3895 to 3900, 3875, 3840. 

• Upside Levels: 3978-3980, 4000 to 4010, 4025. 

SPY