Market Finally Breaks Tight Range

The overall market seems to be waiting for the next catalyst to drive it in either direction. With a lack of new information, it seems that the S&P 500 futures will continue to trade within this tight range until a new catalyst is introduced. Traders and investors should monitor the situation and be aware of any new developments that may drive the market. In the meantime, caution is advised as the sideways market could lead to unpredictable moves at any moment.

The market was calm after the release of the latest Continuing and Initial Jobless Claims data, which showed a minor beat with 196,000 claims. Despite the data being nearly 300% higher than expected in the previous report, the market did not react to the latest announcement as there was no sudden surprise in the number. The median forecast for the report was 190,000, and the market remained stagnant in the pre-market session as it digested various other catalysts that have caused indecision.

Technology Sector Begins to Show Weakness

The selling in the tech sector spilled over into the rest of the market, causing the Dow Jones and S&P 500 to also trade lower. The bearish momentum continued as traders started to unload their positions, pushing the indices further into negative territory. The overall market seemed to be responding to a lack of positive catalysts and growing concerns about valuations in the tech sector. As a result, the major indices opened lower and continued to trade lower throughout the day, with no signs of a bounce.

As the market reached the closing bell, the 4,100 level held as support once again. The slow and steady pressure of selling throughout the day was not enough to break this crucial level. The close will be watched closely in the coming days as the market tries to digest the recent events and make a decision on its next move. The significance of the close above 4,100 cannot be overstated and could provide a glimmer of hope for bulls looking for a rebound.

Levels to Watch On Friday

The psychological significance of the 4,100 level on the S&P 500 futures will be the focus for Friday’s trading session. If S&P continues to trade below it, the 21-day exponential moving average (EMA) at 4,070 may act as a target for the market. Ahead of next week’s U.S. Consumer Price Index (CPI) report, market participants may look for a level of stability, which is often found at a point of liquidity.

If the S&P 500 futures breaks above 4,100, it could indicate bullish sentiment in the market and push prices higher, potentially reaching the target of 4,150. However, if the market fails to hold above 4,100, a bearish sentiment may emerge, leading prices lower towards the 21-day exponential moving average at 4,070. The outcome will depend on market sentiment and the impact of other factors, such as next week’s U.S. Consumer Price Index (CPI) report.

Economic Events to End the Week

Tomorrow there is the University of Michigan (Umich) Consumer Sentiment Index report at 10 a.m. Eastern. Following the economic event, a member of the Federal Reserve (Fed) Board of Governors (Christopher Waller) speaks at 12:30 a.m. Eastern. 

Methodical Selling Causes Market To Go Red

The Nasdaq and the S&P 500 were negative to close the session. The S&P 500 futures closed down 0.94%, losing 39 points, while the Nasdaq futures closed down 0.95%, falling 119 points. The Dow Jones futures followed, closing down 0.80%, a loss of 273 points.