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Technical Report for the Week of 03/13/23

Technical Summary

Equities – Violation of key SPX support at 3,928-4,063 (bottom of Oct 2022 uptrend channel (4,063), 50-day ma (3,999.68), extension of the Jan 2022 downtrend (3,954), 200-day ma (3,940.38), and the 3/2/23 low (3,928.16)) warns at a deeper correction. Next support is 3,721.5-3,810 (May, Jul, Dec 2022 lows -left/right shoulders) and below 3,584-3,637 (Jun/Sept 2022 lows), and 3,491.58 (10/13/22 reaction low). An oversold condition hints at a rally to initial resistance at 3,940-4,000 (50/200-day ma), 4,079-4,119 (3/6/23 high), and 4,195 (2/2/23 high).

Fixed Income – TYX (monthly chart) – Above 3.0-3.02% and 3.455% (2018 high) confirms the 1981 downtrend breakout. Initial support is 3.413-3.641% (200-day ma) and 3.0-3.02%. TNX (monthly) – A breakout above the neckline at 3.036-3.248% confirms a structural breakout. Support is 3.562% and 3.036-3.248%. TNX (daily) – An island reversal (3/2/23) and gap-down (3/10/23) hints at consolidation to support at 3.464-3.704% (50-day and 200-day ma) and 3.334-3.402% (Dec 2022 and Feb 2023 lows). Resistance is 3.83-3.9%, 4.03-4.09%, and 4.22-4.33%.

Commodities – CRB falters near the key resistance at 275-280 (Top of 2022 downtrend channel and Jan 2023 highs). Initial support is 263.69-264.30 (Nov 2022/Jan 2023 lows) and 241-245. WTI Crude – Two negative outside days (3/7 and 3/9/23) signal a test of support at 70-73 (Dec 2022 and Jan/Feb 2023 lows). Resistance is 80.5-83 (Dec 2022 and Jan/Feb 2023 highs) and 85-86/88-90. Gold rebounds from key support at 1,810.80 (2/28/23 low) toward key initial resistance at 1,874-1,882.5 (Jun 2022 high and 50-day ma) and 1,919.

Currencies – USD – The Feb 2023 rally fades near pivotal resistance at 105.5-106.5 (200-day ma). Initial support is 102-103 (50-day ma) and below 100.68-101.42 (May and Feb 2023 lows). EURUSD – Sept 2022 rally to 1.1033 (2/2/23) stalled, prompting a recent correction to initial support at 1.0483-1.0524. Initial resistance is 1.072-1.0735 (50-day ma). USDJPY – A head and shoulders top remains. The Jan-Feb 2023 rally fades near key resistance at 137.5-139.5 (200-day ma). Key initial support is 130.5-132.5 (50-day ma) and 126.5-127.5.

S&P 500 Sectors – RRG study shows similar rotations from the previous week. Materials (XLB), Industrial (XLI), Financial (XLF), and Energy (XLE) weaken within the Weakening Quadrant. Consumer Staples (XLP), Healthcare (XLV), and Utilities (XLU) are also weak in the Lagging Quadrant. Consumer Discretionary (XLY) strengthens, and Real Estate (XLRE) weakens in the Leading Quadrant. Consumer Discretionary (XLY) rallies, and Real Estate (XLRE) falls within the Improving Quadrant.

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