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Stocks higher with Treasuries finding sellers

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Stock futures look to have equities extending yesterday's gains, while selling in Treasuries give the impression that there may be some cash looking to find its ways into equities at the open of trading.

S&P futures (sp03h) 817.00 have jumped to their best levels of the session, despite some weaker than expected economic data released at 08:30 AM EST. NASDAQ futures (nd03h) are also showing gains, with a 15.50 point rise to 989. Dow futures (dj03h) are higher by 79 points at 7,640.

Fair value for the S&P 500 today is $-1.20. That price will not change during the session. HL Camp & Company has their computers set for program buying at $0.44 and set for program selling at $-2.62.

The rise in futures and selling in Treasuries comes despite some weaker than forecasted economic data, which had the U.S. Commerce Department sayaing that sales at the nation's retailers fell 1.6% in February, as winter weather cut into buying of gardening equipment and building supplies, and demand for cars and clothes. Excluding gas and cars, sales fell 1.4%. Economists surveyed had forecasted a 0.5% decline in total retail sales and a -0.1% decline when excluding autos.

In a separate report, the Labor Department said initial jobless claims for the latest week fell by 15,000 to 420,000, compared to a forecasted 418,000. Meanwhile, the four week average of first- time claims for state unemployment benefits by 9,750 to 419,750 in the week ending March 8, the highest since the last week of December. While the latest week's jobless claims fell by 15,000, the prior week's data was revised upward by 5,000 to 435,000.

Still, Treasuries are seeing a strong bout of selling across the major maturities in their early mornings session, with the 5-year YIELD ($FVX.X) jumping higher to 2.67% and 10-year YIELD ($TNX.X) rising to 3.689%, while the 30-year YIELD ($TYX.X) reaches 4.7%. The 10-year Treasury March futures contract (ty03h) $116'165 -0.8% is falling 30/32 and looks to test its upward trending 21-day SMA at $116'317.

In last night's Index Trader Wrap, I didn't cover the S&P 100 Index chart. Here it is with MONTHLY (red) and WEEKLY (blue) pivot analysis retracement overlaid. This morning's pre-market action looks to have the WEEKLY pivot of 420 in play during today's session.

S&P 100 Index Chart - Daily Interval

While the SPX traded its WEEKLY S2 level of support, which has tended to be a Maximum weekly decline, the OEX came up just shy. Bears that didn't lock in some gains near the WEEKLY S2 in the OEX need some early morning resistance to hold at correlative MONTHLY S1 and WEEKLY S1 levels of 409. Otherwise, the OEX looks to have rally potential from a near-term oversold condition back to 415 minimum, with a more formidable "zone of resistance" between the WEEKLY pivot of 420 and MONTHLY pivot of 423.

Jeff Bailey

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