March ADP payrolls came in at +145K versus +210K estimates, strengthening the stagflation/recession argument. 
Futures have drifted lower following yesterday’s sharp decline, suggesting at least a channel bottom/10-day SMA backtest. Keep an eye out for ISM services coming out at 10ET.
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After reaching our next upside target, futures have settled into a pause.
No surprise, as the algo factors are doing the same.
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It was touch and go on Friday as XLE pushed above its 200-day moving average and WTI smacked into its 50-day. Fortunately for oil bulls and inflation enthusiasts, OPEC+ was watching the same charts and took action.
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Futures are up modestly following the Feb PCE print: 0.3% monthly vs 0.4% expected and 5.0% annual versus 5.1% expected. Core came in at 0.3% and 4.6%.
In addition to inflation continuing to fall, the spread between headline and core continues to fall, reflecting an ongoing convergence.
Will it hold up next month, when the YoY gas price delta plunges to -19%, the lowest since Nov 2020 when CPI stood at 1.17%?
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This morning’s economic news came in pretty much on target: not too hot, not too cold.
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Futures are up nicely on a twofer: a not so subtle VIX breakdown… 
…and a very unsubtle NKD rescue (back above the SMA200 just in time for Q1) courtesy of the BoJ’s USDJPY meddling.
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Futures are off marginally as the major indices coast into the end of Q1.
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Our yield curve model sounded the alarm on Friday. But, by the end of the day, it had backed off and cooler heads prevailed.
It’s important to recognize, however, that it remains on the bubble, with only a few basis points standing between a rally and another leg down. From a fundamental standpoint, there seems little doubt that the odds of a recession are on the rise.
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Our yield curve model has finally sounded the alarm.
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Futures have rebounded about 0.5% following yesterday’s roller coaster session that saw SPX backtest its SMA200.
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