Market analysis for Feb. 5th, 2024

Welcome back to a new week of trading opportunities! Futures are down slightly as I type and Treasury yields are rising. We got some hawkish talk from Chair Powell over the weekend. Fed Govenor Bowman as stated that interest rates should be held at their current level and it's premature to look to a rate cut. One analyst put it best, "I think we can officially kiss a March rate-cut goodbye and more than likely a May." -Alex McGrath. 

US futures have priced in a 15.5% chance of a cut in March and a 53.8% chance in May. While the probabilites are coming down and being priced in, they may still be too optimistic. 

Earnings last week were generally strong. We are still working both our GOOG and META trades but generally speaking it was a solid week for earnings and a solid result for us.

On the earnings front this week we have some big names coming: MCD, CAT, LLY, F, AMGN, DIS, UBER, PYPL, CVS, PM, COP, and PEP are some of the ones we have on our radar to trade.

We have FED's Bostic and Goolsbee speaking today and Bostics comments can often be market moving.

The expected move and I.V. in the SPY is not too different from last week. We had a successful last week on the SPY using the expected move as our starting points for our trade setup. 

This past week continued to show a slight rotation out of Tech and Real estate and into the consumer sectors. 

The heat map from last week shows balanced price action.

Open interest walls are growing and tightening. This usually is a pre cursor to a big, directonal move. 

The /NQ continues to bang its head against the high we hit on Jan. 24th. 

While the /ES have been stonger. Breaking out of the chop zone its been stuck in. 

Intra day levels for me: 
/ES. 4980/4999/5011/5022 to the upside. 4969/4952/4941/4932 to the downside.
/NQ. 17776/17800/17838/17866 to the upside. 17700/17657/17582/17463 to the downside.