Market analysis for March 14th, 2024

We had a pretty solid day yesterday. All Three of our earnings trades scored profits. All three of our 0DTE's hit for large gains with our event contract 0DTE scoring a 22% ROI. Unfortunately, once again, I didn't get a full fill on my entry but waiting a bit into the day and placing a limit order a bit away from the market price seems to be the best approach with these event contracts. That means sometimes they don't get a full fill or don't hit at all. We've already got a nice start today with our NDX debit call spread coming into this morning.

The market liked the CPI numbers. Today we get PPI and Jobless claims:
Thursday 14th March
08:30 ET
US PPI for February
The US Producer Price Index measures the average change over time in the selling prices received by domestic producers for their output. It tracks price movements from the perspective of the seller and is an important indicator of inflationary pressures in the economy.
The PPI is calculated for various stages of production, including finished goods, intermediate goods, and crude goods, providing insights into price trends at different levels of the supply chain.
Changes in the PPI can influence the decisions of businesses regarding pricing strategies, production levels, and investment, and can also impact consumer prices (CPI), wages, and monetary policy decisions, making it, in some ways, a leading indicator of inflation.
What to Expect
Inflation is closely watched by the markets.
Higher than expected inflation could prompt the markets to push back on bets for rate cuts this year, which would cause weakness in US stocks, and strength in the dollar.
The inverse is also true. If inflation comes in lower, this could mean that the Fed is getting closer to their inflation target, which could cause markets to ramp up bets for rate cuts this year, which would cause strength in US stocks, and weakness in the dollar.
US Retail Sales
US Retail Sales is a key economic indicator that measures the total sales at retail establishments within the United States.
It includes sales of goods and services from a wide range of retail stores, such as clothing stores, grocery stores, restaurants, and online retailers.
Retail sales data provides insights into consumer spending patterns, which is a crucial component of overall economic activity.
Rising retail sales typically indicate a healthy economy, while declining sales may signal economic weakness.
What to Expect
As this release is at the same time as the PPI data, it is likely to be overshadowed by this. However, if a large deviation is seen here, and not in the PPI data, attention could turn to this.
If it comes out higher than expected, markets will balance the risks between the potential upside inflation risk that increased retail sales could cause, as well as the lower likelihood of a recession in the US.
Typically, markets still see this release as ‘good news is bad news’, which would mean that higher than expected retail sales could cause weakness in US stocks, and strength in the dollar.
Unicredit notes that Retail sales likely rebounded in February after contracting 0.8% in January, which was primarily driven by one-off factors such as bad weather and an overhang from a strong holiday shopping season.
Weekly US Initial & Continued Jobless Claims
Weekly US Initial Jobless Claims and Continued Jobless Claims are key economic indicators that provide insights into the labor market’s health.
Initial Jobless Claims refer to the number of individuals who file for unemployment benefits for the first time during a given week. This metric helps gauge the rate of layoffs and indicates the labor market’s immediate health.
A lower number of initial claims suggests a stronger job market, while a higher number may indicate economic weakness.
Continued Jobless Claims, on the other hand, represent the number of individuals who continue to receive unemployment benefits after their initial claim. This figure reflects the ongoing level of unemployment and can indicate the persistence of joblessness in the economy.
What to Expect
As this release is coming out at the same time as the US PPI, it is likely to be overshadowed by this.
Nonetheless, higher-than-expected Jobless Claims indicate higher unemployment, which is often seen by the markets as a downside risk to inflation. This could cause strength in US stocks and weakness in the dollar, as it could cause traders to push forward their bets for Fed rate cuts.
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We have quad witching coming up tomorrow:
The quad witching dates in 2024 happen on these days:

• 15 March 2024.
• 21 June 2024.
• 20 September 2024.
• 20 December 2024.

This once a quarter expiration of Stock Index futures. Single stock futures. Option on stock-index futures and Stock index options happens once a quarter and can play havoc with the market. We usually trade small on Fridays anyway but be aware of potential whipsaws during tomorrows trading session.

The market continues to hold its bullish bias.

As bullish as we remain, we continue to just bounce along these ATH's and continue to form resistance. PPI today could be the catalyst to break us into a more trending market 

Intra-day levels for me:
/ES; 5192/5206/5221/5240 to the upside. 5166/5156/5150/5139 to the downside.
/NQ; 18188/18208/18256/18308 to the upside. 18117/18083/18035/17923 to the downside.

Trade docket for today: BA, DIA, GLD, GOOG, META, MSTR, NDX/SPX/Event contract 0DTE's, NVDA, QQQ, SPY, WOOF, Vampire overnight trade, ADBE and ULTA earnings trades.

​My bias for today is bullish.