EB Daily Market Report - Tuesday, March 7, 2023

Dear Members.

Today is Fed Speak day as Fed Chairman Jerome Powell spends the day testifying before Congress. It's too early to tell where the market will end up today but just as he began his testimony, stocks immediately headed lower. While Powell will speak both today and tomorrow, it turns out that he is obligated to repeat his testimony tomorrow - i.e., no new language for what he has already prepared. So, even though questions from lawmakers tomorrow might result in some "new" information, we're likely to know exactly what he is thinking by the end of today.

A few observations. First, the VIX is up just a tad; nothing - at the moment - is showing traders are overly concerned. Next, the yield on the 10 year Treasury Note is back below 4% after briefly spiking above that level early in the session. So, even though Powell has kept his tough talk of raising rates to fight inflation, we aren't seeing a corresponding increase in rates. 

We should continue to keep an eye on where the S&P closes. Currently, the 50 day on the S&P is at 3994 which corresponds with price support. Should that go the next key level of support is at the 200 day, currently at 3940. To the upside, if we see any turnaround to the upside, it would be bullish to close back above the 20 day, currently at 4026.

I will be back tomorrow with another daily update

At your service,

John Hopkins