E-mini S&P and NQ Rally into Key Resistance—Will Tech Lead the Breakout?

E-mini S&P (March) / E-mini NQ (March)

S&P, yesterday’s close: Settled at 6146.75, up 14.75

NQ, yesterday’s close: Settled at 22,232.25, up 36.00

Yesterday’s late price action reminded me of the old saying, ‘never short a dull market’; after a little shake lower, E-mini S&P futures ripped 0.5% in the final hour for the highest settlement since January 23rd. While tech and the E-mini NQ were firm, leadership really shined through cyclicals; financials, industrials, and energy. However, we must point out that the E-mini Russell, which typically capitalizes on cyclical rallies, left much to be desired. Furthermore, although it gained about 0.5% yesterday, it is now down on the week ahead of the opening bell. Traders should keep an eye on these relationships to gauge risk-appetite.

A firm finish yesterday helped E-mini S&P and E-mini NQ futures revisit the strong layer of resistance we described here. For the E-mini S&P, this is rare major four-star resistance at 6154-6167, which aligns high settlement with the area that traded most heavily when record highs were made at 6178.75. First key resistance for the E-mini NQ has also been sticky at 22,315. While yesterday’s move was constructive, and arguably rotational strength helped lift price action, we do believe leadership must appear in order to lift both indices into a decisive breakout zone. While we are not putting all of our eggs in one basket, we do believe tech is most likely to rise to the calling. Given some softness in price action from the highs ahead of the opening bell, we adjusted our Pivot and point of balance to accept yesterday’s low range. We must see price action respond to supports detailed below, but ideally a constructive tape trading at and above our Pivot and point of balance at….