S&P 500 Daily Perspective for Mon 15 May 2023

Still in short-term balance but odds have shifted to favor a break lower

May 14, 2023

GDR Model Performance

This year has been challenging for the Model’s style due to low confidence in the market.

GDR Model Outlook

The overall Model deteriorated and is now mostly Bearish in the near-term. There is some disagreement with the long-term outlook showing Bullish so until the different components align, the probability of a large directional move is low.

GDR Model Position

The is currently short the market as conditions have continued to deteriorate. Given the disagreement within the model’s components, there’s a chance this position may be closed soon.

S&P 500 Futures Market Profile Analysis

Near-Term Outlook: Still in Short-Term Balance, tilt Bearish

Alternate Outlook: N/A

Bullish: 4170 (5/10 High), 4188 (Top of Current Balance Zone), 4221 (Closes Prev Gap Down)
Bearish: 4110 (Poor Low, Weak Low), 4080 (Bottom of Current Balance Zone), 4062 (5/4 Weak Low)

Market Narrative

While the market remains in Short-Term Balance after a rejected breakdown, it did leave behind a Low that is both Poor and Weak. This increases the odds that the break from the current Short-Term Balance will be to the downside. Recall that there is still plenty of Poor Structure to be repaired below, but barely any above.

Balance Trading Guidelines are a good guide for how to approach the current market, and remember these are only probabilities - just because the odds favor an occurence, it doesn’t guarantee it will happen.

Economic Calendar

Today at 8:30am - NY Empire State Manufacturing Index
Today at 8:45am - FOMC Member Bostic Speaks
Today at 9:15am - FOMC Member Kashkari Speaks
Later This Week: Fed Chair Powell Speaks (Fri)