Futures Slide as Oil Spike and Iran Escalation Rattle Markets

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

S&P, yesterday’s close: Settled at 6779.50, down 7.75

NQ, yesterday’s close: Settled at 24,983.50, up 1.00

E-mini S&P and E-mini NQ futures failed to gain traction yesterday despite ORCL finishing up 9.2% and CPI largely in line with expectations. Semis and software did well, along with UBER and TSLA, and there was good participation from energy. However, private credit headlines continue to weigh on financials, and supply chain disruptions and consumer fears have hampered staples and discretionary. Additionally, given the CPI components, Core PCE, released later this month, and the Fed’s preferred inflation indicator, is feared to not be as friendly.

Things did not improve overnight after Iran escalated attacks, sending WTI Crude Oil up $7.50 and to a high of $95.97. E-mini S&P and E-mini NQ futures were tagged by about 1%, and yields rose. Although things are off their worst levels, it has set a risk-off tone for the start of the day. Yesterday morning, we said a break below Tuesday’s opening bell range, “Would likely trigger additional selling toward the level at which Monday’s late rally began, with recurring supports at 6715.75-6718.75 in the E-mini S&P and 24,651-24,694 in the E-mini NQ.” This is exactly what happened last night, and now it is up to buyers to defend these supports through the opening hour and begin to show some stability with price action above our Pivot and point of balance, and first key resistance at…….