Morning Notes – Friday March 3, 2017

/ March 3, 2017

Directional Bias For The Day:

  • The futures are almost drifting down
  • In a down trend since 2:30 PM on March 1
  • Lower high and lower lows on 30-minute timeframe
  • Odds are for a down to sideways day; watch for break above 2380.75 for change of fortunes

Markets Around The World

  • Markets in the East closed lower
  • European markets are mixed – Germany, U.K, Switzerland and STOXX 600 are lower; France, Spain and Italy are higher
  • Dollar index, EUR/USD and GBP/USD are lower; USD/JPY is higher
  • Commodities are mixed – crude oil and NatGas are up; gold, silver and copper are down
  • 10-yrs yield closed at 2.489% on March 1 up from March 1 close of 2.463%; 30-years closed at 3.082%, up from 3.071%

Key Levels:

  • Critical support levels for S&P 500 are 2380.13, 2371.54 and 2358.96
  • Critical resistance levels for S&P 500 are 2388.59, 2400.91 and 2405.64
  • Key levels for eMini futures: break above 2380.75 high of 6:00 PM on March 2 and break below 2373.75, the low of 4:30 AM

Pre-Open

  • Pre-NYSE session open, futures price action is mixed – at 8:30 AM, S&P 500 futures were down by -4.00, Dow is up by +8.00 and NASDAQ is down -10.75
  • On Thursday, at 4:00 PM, S&P future (March contract) closed at 2380.25 and the index closed at 2381.92 – a spread of about 1.75 points; futures closed at 2382.00 for the day; the fair value is -1.75

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 red harami candle with no upper and almost no lower shadows
  • Intraday range less than 1.00% since December 29;
  • Breaking out from an up-sloping channel that is n effect 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)
  • Drifting lower since making a high of 2301.00 at 2:00 PM on March 1
  • At a support from previous high
  • Retracing from the high of 2401.oo reached on March 1
  • Confirmed uptrend
  • Below falling 20-bar EMA nd at flattening 50-bar EMA
30-Minute (e-mini future)
  • Retracing from the high of 2401.00 made at 2:30 PM on March 1; lower highs and lower lows since then
  • Unlike previous few days the price is bouncing after staying a range from 11:30 PM to 5:00 AM
  • Below flat-to-falling 20-bar EMA and 50-bar EMA

Previous Session

U.S. indices closed lower on Thursday March 2. Major indices opened at the high of the day and then drifted lower.

S&P 500, Dow Jones Industrial Average and Russell 2000 made harami candle and did not breach the lows of March 1. NASDAQ Composite, NYSE Composite and Wilshire 5000 Total Market Index breached the low of March 1 and closed below it.

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