US stock markets are balanced with a slight bearish tendency as investors seem to wait for the earnings reports and Fed speeches to conclude scenarios with the rate-hike path and the health of the economic structure of the US.

JP Morgan Chase and Wells Fargo reports were beating estimates in the prior week while traders monitor the smaller banks which were the main reason for the latest banking crisis in March to conclude the current situation.

Interest rate hikes probabilities for potential rate cuts starting around September changed to 40% which may vary, depending on the upcoming economic data and earning session. The projection is still dovish with potential easing in the current monetary tightening cycle in this Year. However, recent Fed speeches hint at a more hawkish approach with more rate increases, due to the elevated inflation expectation.

Short-term perspective is mixed and calculation pointing to a balanced behavior while a current positive volatility might favor the selling side.

Looking at the intraday interval ES Futures contract, we can observe the prior profile as balanced structure as traders may lean on the balance extremes to conclude rotational scenarios.

The dollar rose by about 0.6% by the mentioned better-than-expected earnings report and the elevated inflation expectations, which may prompt the central bank to raise interest rates further which will boost the greenback, pressuring commodities and equities. Retail sales saw lower spending which points to a potential weakening economic structure while the core sales were solid. Markets expect another interest rate hike with about 25 bps and halt for two months in May.

The institutional flow seems to keep buying with fresh long positions while covering short positions which tends to keep the bias to the upside as of the COT data from April 11.

The technical perspective was hitting the prior swing highs back from February which may lead to long liquidations for profit taking on part of core long positions, leading the market to pullback, therefore market participants might looking for areas to add to their core positions around Quarterly VWAP levels such as the developing VWAP or lower value extreme, depending on the flow of economic data and Fed speeches. 

The NY Empire State Manufacturing Index unexpectedly jumped to 10.8 in April, pointing to some economic strength as positive data seems to be bearish for stock markets due to a potential hawkish approach and projection of rate-hikes.

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