On Friday at 4:00 PM, S&P future (Sept contract) closed at 2178.50 and the index closed at 2179.98 – a spread of about 1.50 points
Key Levels:
Critical support levels for S&P 500 are 2173.59, 2170.67, and 2164.07
Critical resistance levels for S&P 500 are 2184.87, 2187.94 and 2193.30
Pre-NYSE session open, futures price action is to the upside; at 8:15 AM, S&P 500 futures was up by +1.75, Dow was up by +19 and NASDAQ was up by +4.75
Economic Data:
Report
Current
Est.
Prev.
U.S. ISM Non-Manufacturing PMI (10 AM)
51.4
55.4
55.5
The trend and patterns on various time frames for S&P 500 are:
Up trend since Feb 08, 2016 with one pullback; broke out of a 2-year trading range in July, 2016
Last swing low, 1991.68, was reached on June 27, 2016
Daily
Price bounced off 20-day and 10-day EMAs following few days of indecisive action
A rally and close above 2193.42 will nullify the abandoned baby top reversal formed on Aug 24
9-period RSI is diverging and showing a downtrend line; for rally to continue the down trend line needs to be broken
Uptrend since June 28th with one pullback; last swing low 2147.58 on Aug 2
Mostly sideways move since August 5
61.8% retracement from last low is 2116.59
2-Hour (e-mini future)
Drifting lower since 12:00 Noon high of 2182.25 on Aug 29
Sequence of lower high / lower lows since AM on Aug 23 broken in post-NFP rally on Friday
A downtrend line since 10:00 AM on Aug 23 also broken on Friday
Forming a pennant with high of 2183.75 reached at 10:00 AM on Friday; a rise above 2182.25 will signal a break to the upside
Previous pattern – a rectangle trading range – is morphing into a broadening pattern with horizontal upper limit
30-Minute (e-mini future)
A symmetrical triangle forming (pennant in 2-hour timeframe)
Mostly sideways since Friday’s close
Before NYSE Session Open
Friday’s Non-Farm Payroll report changed market’s expectation about the Fed-Fund rate increase. This turned out to be quite bullish for major U.S. indices. Small-cap, Russell 2000, was the biggest winner.
On Friday:
Up
Down
Last
Notes
S&P 500
+9.12 or +0.4%
2179.98
Gapped up on Friday and maintained the gap
Critical resistance of 2187.94, the Aug 26 high
Critical support of 2147.58, the Aug 2 low
Dow Jones Industrial Average
+72.66 or +0.4%
18491.96
Crossed above 20-day and 10-day EMA
Bounced off 50-day EMA on September 1
NASDAQ Composite
+22.69 or +0.4%
5227.21
Gapped up on Friday and maintained the gap
Bounced off 50-day EMA
Russell 2000
+12.03 or +1.0%
1251.82
Range expansion day on Friday
Bounce of 20-day EMA on September 1
Asian Session
Asian bourses were mostly up on Tuesday:
Up
Down
Last
Notes
Shanghai Composite
+18.62 or +0.6%
3090.71
The down-sloping flag since Aug 15 broken to the upside on Tuesday
Uptrend since Jan 25 2016
Hang Seng
+138.13 or +0.6%
23787.68
Gapped up on Monday above the resistance – Oct 2015 high of 23423.64 on weekly charts
Tuesday was the follow-through on the gap-up
Nikkei 225
+44.35 or +0.3%
17081.98
Gapped up on Monday above the resistance of 16943.67 – upper limit of an ascending triangle on daily charts – but closed below the open
Tuesday was green harami candle within the red candlestick
S&P/ASX 200
-16.00 or -0.3%
5413.60
Monday was bullish engulfing candle
Still in the CD leg of bearish ABCD pattern with target near 5370
Prior support is acting as a resistance
On 89-week SMA
Sensex
+445.91 or +1.6%
28978.02
Gapped-up above the resistance of July 2015 high of 26576.32
100% extension target from the breakout of a rectangle trading box is reached
Next target is 161.8% extension, near 29125
Kospi Composite
+6.45 or +0.3%
2066.53
Gapped up on Monday; Tuesday was follow-through day
In a uptrend on daily timeframe; last swing low 1993.00 reached on Aug 3
European Session
In pre-US session, the European stock markets are mostly to the upside at 8:30 AM.
Up
Down
Last
Notes
DAX
+43.97 or +0.4%
10716.19
Broken above weekly downtrend line since April 2015 and with two touches
Bouncing off 89-week SMA and at 50-day EMA
FTSE-100
-27.35 or -0.4%
6852.07
Crossed above 20-day EMA on Monday
Bouncing off 10-week SMA
CAC-40
+9.53 or +0.2%
4541.08
Struggling to overcome the resistance created by May 31 high of 4536.86
IBEX
+26.20 or +0.3%
8959.50
Crossed above falling 200-day SMA and 39-week SMA on Friday
Next resistance at 9360.20, the of a reversal day on April 27
FTSE MIB
+18.70 or +0.1%
17209.14
Above 17122.82, the high point reached after Brexit on Aug 1
Breaking out of a horizontal trading range
Swiss Market Index
+14.86 or +0.2%
8325.3
Bounced off a rising 50-day EMA and a falling 200-day SMA on Friday
Making new 2016 high
STOXX 600
+0.54 or +0.2%
351.16
Bounced off a rising 50-day EMA and a falling 39-week SMA on Friday
Currencies
Up
Down
Last
Notes
US Dollar Index
-0.229
95.615
In the middle of rectangle trading range since January 2015 on weekly charts
Finding resistance at 89-week SMA and 50-day SMA
EUR/USD
-2.8 pips
1.11605
At 200-day and 50-day SMAs
Falling below the downtrend line that it broke on August 16 to the upside
GBP/USD
+45.0 pips
1.33510
At the upper limit of a symmetrical triangle at 30-year low levels
Crossed above a falling 5-day SMA on September 1
USD/JPY
+0.2 pips
103.289
Struggling to stay above a falling 50-day SMA
Commodities
Up
Down
Last
Notes
WTI Crude
-0.53 or -1.2%
43.91
At flattening 39-week SMA
Off Monday’s high of 46.53
Natural Gas
-0.046 or -1.6%
2.810
Broken above an up-sloping flag on Aug 25 and is back at the downtrend line, which is acting as a support
Gold
+11.8 or +0.9%
1338.50
Bouncing off the lower line of a slight down-sloping channel
Silver
+0.339 or +1,8%
19.71
Above the lower limit of a broken descending triangle
A down-sloping flag is emerging
Copper
+0.0080 or +0.4%
2.0860
At the lower limit of a symmetrical triangle – weekly charts – at the low levels since 2009
Yields
Up
Down
Last
Notes
30-Year Treasury
-0.5 basis points
2.266%
Crossing above a falling 50-day SMA
In the middle of a symmetrical triangle
10-Year Treasury
+0.3 basis points
1.599%
Below upper limit of an ascending triangle
Pivot Levels:
S&P 500 is above its 10-D EMA, 10-D EMA is above 20-D EMA and its 20-D EMA is trending above 50-D EMA since March 9, 2016.
S&P 500 Cash
eMini Futures
Daily
Level
Break Chance
Level
Break Chance
Pivot
2179.48
2175.33
R1
2185.37
59%
2186.42
55%
R2
2190.76
44%
2194.83
32%
R3
2196.65
46%
2205.92
27%
S1
2174.09
36%
2166.92
36%
S2
2168.20
34%
2155.83
27%
S3
2162.81
24%
2147.42
19%
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 chance comes in picture only when R1 is broken. So are the probabilities calculated for R3, S2 and S3
