Morning Notes - Wednesday September 14, 2016 : Market Remarks

Directional Bias For The Day:

The futures are moving sideways since NYSE session close on Tuesday
Odds are for a sideways to an up day
3rd day following a big-decline, like the one on Friday, has 61% chance of being an up-day for S&P 500
Key move: Break above 55 for 14-Period RSI on 30-minute chart
Futures are sideways since Asian session on Sunday (U.S. time) after falling more in the after-market trading post-NYSE close on Friday
Markets in Asia were mixed; China, Japan and Hong Kong were modestly down but India and Australia were up
European markets are mixed but mostly up for the first time in 4-5 days
On Tuesday, at 4:00 PM, S&P future (Dec contract) closed at 2119.50 and the index closed at 2127.02 – a spread of about 7.50 points

Key Levels:

Critical support levels for S&P 500 are 2121.54, 2116.67, and 2106.97
Critical resistance levels for S&P 500 are 2135.68, 2150.47 and 2157.62
Pre-NYSE session open, futures price action is slightly to the upside; at 6:45 AM, S&P 500 futures was up by +2.25, Dow was up by +15 and NASDAQ was up by +9.25

The trend and patterns on various time frames for S&P 500 are:

Monthly	Up trend since Feb 08, 2016
Weekly:	Current uptrend under pressure Fallen below an up-trending 10-week SMA 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*	Uptrend under pressure Price back at 50-day EMA after a dip below Gave back all of the gains of the piercing candle following a range expansion red candle 38.2% retracement from last low is 2116.59 and was not breached
*2-Hour (e-mini future)*	Sideways since Tuesday afternoon between 61.8% and 76.8% retracement of the bounce from big decline
*30-Minute (e-mini future)*	Low for the day touched 2112.25, which was 76.8% of the retracement of the bounce from the lows of 2100.25 to the high of 2156.00 Since Asian session 14-period RSI is finding a ceiling near 50;

Before NYSE Session Open

Tuesday was almost a mirror opposite of Monday. Major U.S. indices gapped lower at the open and stayed lower. However, not all behaved in similar manner. Big caps were helped by the performance of $AAPL, which gained 2.4% on a down day.

On Tuesday:

	Up	Down	Last	Notes
S&P 500		-32.02 or -1.5%	2127.02	Gave back 103% of Monday’s gain Did not breach Monday’s low and the 38.2% retracement from last low is 2116.59
Dow Jones Industrial Average		-258.32 or -1.4%	18866.75	Gave back 108% of Monday’s gain Did not breach Monday’s low Volume was at the same level as that on Monday but less than Friday’s volume
NASDAQ Composite		-56.64 or -1.1%	5155.25	Made a small red-harami candle pattern within a larger green candle – hinting indecision Gave back 66% of Monday’s gain
Russell 2000		-23.55 or -1.9%	1212.32	Gave back all of Monday’s gain and then some (141%) Breached Monday’s low Next swing low is at 1198.73
Dow Jones Transportation Average		-153.99 or -1.9%	7771.91	Gave back all of Monday’s gain and then some (149%) Breached Monday’s low Next swing low is at 7622.92
VIX	+2.69 or +17.7%		17.85	Closed above Friday’s level but well below Monday’s high Monday’s close was below gap-higher open Made a green harami candle within a large red candle