Short Term Trading Week Starting: 4 Mar, page-72

US Early Update

Range bound markets have led to some early session weakness here. The difference is that we have US treasuries following on with the some gains that took down yields yesterday afternoon. The benchmark ten year is at 2.72%. We also have some weaker breadth to consider. SPX 2795 is now a stronger area of resistance than it was before Monday's selling. 2800 is the psychological resistance and there is weekly resistance at 2820. 2775 is the first area of support. Below that you have the unfilled gap from 14-15 Feb which starts at ES 2763/SPX 2760.24. Below the true gap is 2750 and the 200 day moving average. ES profile.

The US trade balance is the economic point of the day as it expanded to - 59.8B for December. It came in pretty high and this is not going to make the president very happy. There was no abrupt futures reaction after the release of that report but the action is a bit weak after the cash open.

Opinion

As you know, there is increased chatter surrounding the release of the Special Counsel's report to the Attorney General. While large funds have access to some very fast networking, they do not know what is in that report or the dates of potential indictments. Traders can only speculate on how the market will react to the report's release - the details will not be immediately known beyond the AG's office. There is also the separate issue of the possible indictments of individuals close to the president. This would cause some turbulence. Such indictments are often put out after the market close at week's end. This is something to at least be wary of as we go into the weekend.