Slow Start to a Busy Week

Earnings pick up pace on Tuesday and Wednesday.

The S&P rode a four-day win streak into Friday’s session, but ended slightly lower for the day as it barely missed out on a perfect week of five green sessions. 

Even if we would have eked out a gain on the day — as the S&P closed lower by about 10 basis points — it was a discouraging reaction to earnings. JPMorgan blew out earnings expectations, but barely closed green on the day. WFC ended slightly lower, while Citigroup fell more than 4% and gave us a nasty bearish engulfing candle. 

What’s it mean for this week? 

We don’t know yet. We want to see if we have the same reaction to this week’s reports or if Friday’s action was a one-off. 

Earnings are slow today, but regain significance on Tuesday with BofA and Goldman Sachs. Netflix and Tesla will bask in the earnings spotlight on Wednesday, while TSMC — the No. 2 holding in the SMH ETF — will report earnings on Thursday, potentially impacting chip stocks as a whole.

Let’s go!

Technical Edge 

• NYSE Breadth: 16% Upside Volume

• Advance/Decline: 24% Advance

• VIX: ~$13.50

There are days where there are multiple setups and there are days where a “less is more” approach is applicable. Today may be the latter if we don’t get setup we like. 

SPY

The S&P has been rolling, but a “dip that refreshes” could do bulls a favor early this week. I don’t know that we’ll fall enough to get us to the ~$444 zone today. If we do though, it’s worth a shot on the long side. 

• Upside Levels: $450, $451.75

• Downside Levels: $447.50, $446, $444

S&P 500 — ES Futures

Not much to say in regards to the S&P today. The buy zone is pretty clear in the 4485 to 4495 area. 

• Upside Levels: 4551, 4560, 4571.25

• Downside levels: 4525-28, 4510, 4485-4495

SPX

• Upside Levels: 4523-27, 4535, 4550

• Downside Levels: 4500, 4472, 4450-55

NQ

Wow! The NQ tagged our 15,855 level, traded 2 points above it and then fell 150 points. It emphasizes why some of these levels can be so critical.