Morning Notes – Tuesday February 28, 2017

Sunil Sharma

8 years ago

Directional Bias For The Day:

The futures are moving sideways lower since 4:30 PM on Monday
Very narrow trading range
Odds are for a sideways day; watch for break above 2370.75 or below 2361.00 for change of fortunes

Markets Around The World

Markets in the East were mixed – Shanghai, Tokyo and Seoul were up; Hong Kong, Sydney and Mumbai were down
European markets are mostly higher – only Germany is lower
Dollar index and GBP/USD are lower; USD/JPY and EUR/USD are higher
Commodities are mostly lower – only copper is higher
10-yrs yield closed at 2.369% on February 27 up from February 24 close of 2.317%; 30-years closed at 2.986%, up from February 24 close of 2.955%

Key Levels:

Critical support levels for S&P 500 are 2367.22, 2361.87, and 2352.87
Critical resistance levels for S&P 500 are 2373.57, 2377.39 and 2383.24
Key levels for eMini futures: break above 2370.75, high of 3:30 PM on February 27 and break below 2361.00, the low of 9:30 PM on February 27

Pre-Open

Pre-NYSE session open, futures price action is almost unchanged – at 7:00 AM, S&P 500 futures were down by -1.00, Dow up by -+1.00 and NASDAQ up by +0.25
On Monday, at 4:00 PM, S&P future (March contract) closed at 2368.75 and the index closed at 2369.75 – a spread of about 1.00 points; futures closed at 2368.25 for the day; the fair value is -0.50

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

Monthly	Confirmed Uptrend Uptrend resumption since Feb 08, 2016 after a pull back of -15.2%
Weekly:	Candlestick for the last week, Monday February 20, was a small green candle, that gapped up from previous week Up for five consecutive weeks Broke above a down-sloping flag on November 14, 2016; first target of 2285.92 is met; next target is near 2363.14 Last swing low, 2083.79, was the low on November 4, 2016 Above 39-week SMA and 89-week SMA
*Daily*	A green candle that opened in the body of previous day and closed higher; made another high Intraday range less than 1.00% since December 29; since February 1 only three down days, all separate Drifting higher within an up-sloping channel since December 27 Above 100-day, 200-day, 50-day, and 20-day SMA/EMA Sequence of higher highs and higher lows Last swing low 2263.62
*2-Hour (e-mini future)*	In a narrow since 6:00 PM on February 26 Up trend-channel line forming with three highs of February 21, 23 and 26 Early morning pattern similar to that of last few days with minor differences Confirmed up-trend Above a rising 20-bar EMA and 50-bar EMA
*30-Minute (e-mini future)*	Broadening top formation – four touches to upper limit and two touches to lower limit; a break below 2349.50 will confirm the topping pattern A double top of 2370.00 formed by the high of 11:00 PM on February 26 and 3:00 AM; target of the break below was achieved Above rising 20-bar EMA and flattening 50-bar EMA

Previous Session

U.S. indices mostly higher after the first half-hour of decline on Monday February 27. S&P 500 is rising after the gap down open on Friday February 24.

S&P 500 and Dow Jones Industrial Average made another highs other major indices did not.