Market Diary – Friday July 15, 2016

Directional Bias For The Day:

• The futures are directionless
• The 30-minute chart of S&P 500 future is showing an uptrend but since mid-day on Thursday, the price is range bound
• Critical support levels for S&P 500 are 2159.40 and 2152.42
• Critical resistance levels for S&P 500 are 2168.99 and 2175.00 ;
• Early morning futures price action is to the upside – at 8:30 AM, S&P 500 was up by +0.50, Dow by +16.00 and NASDAQ by +1.50

Before NYSE Session Open

On Thursday, S&P 500 gapped up but then closed at the middle of the range for the day. S&P 500 future, on the other hand, closed at a level that lower than 9:30 AM NYSE open. The critical chart is that of NASDAQ Composite. After making a bearish engulfing candle on Tuesday, it too closed up on Thursday but its close was below the open, which increase the importance of a breach of day’s low of 5025.15.

Asian Session

The Asian bourses were mostly up on Friday.

• Shanghai Composite was up by +0.277 or +0.01%, almost unchanged; since Wednesday, it has traded in a narrow band
• Hang Seng was up +98.19 or +0.46%
• Nikkei 225 closed up by +111.96 or +0.68% to 16497.85, with that it closed the gap-down created on June 13
• Sydney’s S&P/ASX 200 gained +18.00 or +0.33% to 5429.60
• Sensex lost -105.61 or -0.38; it made a bearish engulfing candle on Friday following a bullish engulfing candle on Thursday
• South Korea’s KOSPI gained +9.49 or +0.42%

European Session

In pre-US session, the European stock markets are mostly down following a streak of six up days..

• DAX is down by -18.11 or -0.18% to 10050.19
• FTSE-100 is down -8.38 or -0.13% to 6646.09; On Thursday it closed at 6654.47, near the low for the day after being up to 6743.42
• CAC-40 is down by -0.53%, Spanish IBEX by -0.40%, STOXX-600 by -0.32, Swiss SMI-SWX by -0.36%, and Italian FTSE MIB by -0.44%,

Currencies

• U.S. Dollar index is up by +0.065 to 96.155; if the index does not break out to the upside soon then the handle pattern of an uneven cup-with-handle pattern will lose its relevance
• EUR/USD is almost unchanged to 1.11187 so is GBP/USD at 1.3325
• USD/JPY is up by +64.7 pips (Yen is weaker) to 105.991; next resistance is at 106.840

Commodities

• WTI Crude is up by +1.09% to 46.19
• Natural Gas is down by -1.32% to 2.689
• Gold is down by -1.70 to 1330.50; Silver is down by -01.03% to 20.315
• Copper is up by +0.87% to 2.2625

Yields

• U.S. Treasury yields are up following a positive close on Thursday; 30-year yield is up by 31 basis points to to 2.278% and 10-year by 39 basis points to 1.570%

Pivot Levels:

S&P 500 is above its 10-D EMA, 10-D EMA crossed above 20-D EMA and its 20-D EMA is trending above 50-D EMA since March 9, 2016.

Note: The probability of a level breaking is shown above is for the current condition when the price is above 20-D EMA, 10-D EMA is above 20-D EMA and 20-D EMA is above 50-D EMA. R2 break probability comes in picture only when R1 is broken. So are the probabilities calculated for R3, S2 and S3