Market Roars To Life As Psychological Level Fends Off Bears


Joseph Rangel

Mar 03rd 2023  .  3 min read

Market Roars To Life As Psychological Level Fends Off Bears

The sentiment in the stock market changed from negative to positive at the end of yesterday’s trading session following dovish comments made by several Federal Reserve (Fed) speakers. This momentum carried over into after-hours trading and continued throughout the night. Although the S&P 500 futures did not manage to close above the crucial 4,000 level at the end of the session, they were able to overcome this hurdle by the opening bell this morning.

At the start of the trading session, all indices were showing an upward trend, moving in sync with each other. There were several indications that this momentum could continue throughout the session, including the S&P 500 futures holding steady above the crucial 4,000 level, a strong performance from technology stocks, and the Dow Jones futures gearing up for a push higher. Additionally, a few remaining catalysts were on the horizon, with the rest of the necessary preparations already taken care of.

Options with Sam Shames
Futures with Jack Roberts
Voodoo & Fibonacci with Henry Gambell

Market Responds Positively To Economic Catalysts

At 9:45 a.m. Eastern Time, the S&P Global U.S. Services Purchasing Managers Index (PMI) figures were released. The report had a forecast of 50.5, but the actual reported value of 50.6 exceeded expectations, providing a boost to the market and contributing to the upward trend that was soon to follow. The release of the report briefly pushed the market higher, paving the way for the next economic event. Shortly after, at 10 a.m., the Institute for Supply Management (ISM) Services data was published. The report was expected to have a median forecast of 54.3%, but the actual figure of 55.1% exceeded expectations, providing another positive catalyst for the market’s upward momentum.

In the end, the roadmap for a move higher that incorporated those levels was all that traders needed to navigate today’s trading session. The market was able to reach the 15-day Simple Moving Average (SMA) at 4,050, but after that, the price action appeared to be exhausted, and the market began to consolidate as the closing bell approached.

Picture of psychological levels on the stock market futures
/ES Futures move through psychological levels in a meaningful way.

Economic Events For Next Week

Looking into next week, several economic events will hold weight in the market. The first event will be Federal Reserve (Fed) Chairman Jerome Powell testifying to the Senate at 10 a.m. on Tuesday. The Automatic Data Processing (ADP) national employment report will be released on Wednesday at 8:15 a.m. Later in the session, Jerome Powell will testify to the House at 10 a.m. Eastern. At the same time Powell testifies, Job Openings and Labor Turnover Survey (JOLTS) will be released. Later in the session on Wednesday, Beige Book will be announced at 2 p.m. Eastern. 

Market Climbs Higher: Strong Rally to Close Out Week

The Nasdaq and the S&P 500 were positive to close the session. The S&P 500 futures closed up 1.64%, gaining 65 points, while the Nasdaq futures closed up 2.10%, adding 252 points. The Dow Jones futures followed, up 1.20%, an additional 395 points.