Market Diary – Tuesday July 26, 2016

Directional Bias For The Day:

• Greater likelihood of a range bound day with high pressure for market to decline
• The 4-Hour chart of S&P 500 future is showing a narrow rectangle trading range since July 13th, bounded between 2173 and 2153
• Critical support levels for S&P 500 are 2159.75, 2155.79 and 2146.21
• Critical resistance levels for S&P 500 are 2173.71, 2179.81 and 2185.90
• Early morning futures price action is indecisive; at 8:30 AM, S&P 500 future was down by -0.50, Dow is down by -12.00 and NASDAQ is up by +5.50.

Before NYSE Session Open

Major US indices declined slightly on Monday, July 25th. S&P 500 is range bound for the past few trading sessions and Monday was no different. Since July 14th, it has stayed between 2155.79 and 2175.57. On Monday, S&P 500 lost -6.55, Dow lost -77.79, NASDAQ -2.53 and Russell 2000 -3.07.

Asian Session

The Asian bourses were mixed on Tuesday.

• Shanghai Composite was up by +34.34 or +1.14%
• Hang Seng was up +136.29 or +0.62%
• Nikkei 225 lost -237.25 or -1.43%
• Sydney’s S&P/ASX 200 gained +3.9 or +0.07%
• Sensex lost -118.82 or -0.42%
• South Korea’s KOSPI was up by +15.02 or +0.75%

European Session

In pre-US session, the European stock markets are mostly mixed.

• DAX is up by +36.80 or +0.36%
• FTSE-100 is up by +20.11 +0.30%
• CAC-40 is up by +0.03%, Swiss SMI-SWX by +0.38%, and STOXX-600 by +0.11%
• Spanish IBEX is down by -0.49% and Italian FTSE MIB by -0.33%;

Currencies

• U.S. Dollar index is down by -0.191 to 97.135
• EUR/USD is up by +1.8 pips to 1.09949
• GBP/USD is down by -4.00 pips to 1.3134
• USD/JPY is down by -154.1 pips (Yen is stronger) to 104.286

Commodities

• WTI Crude is down by -0.51 or -1.18% to 42.62; Natural Gas is down by -0.057 or -2.07% to 2.69
• Gold is up by +2.40 or +0.18% to 1321.90; Silver is up by +0.028 or +0.14% to 19.675
• Copper is down by -0.015 or -0.07% to 2.2155

Yields

• U.S. Treasury yields are down for the day so far
• 30-year yield is down 2.4 basis points to 2.263% and 10-year is down by -1.7 basis points to 1.554%

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