Morning Notes – Friday June 23, 2017

/ June 23, 2017

Directional Bias For The Day:

  • Futures are mixed
  • S&P Futures are little changed; bouncing off 2430.00, low reached at 6:15 AM
  • Odds are for a sideways to down day; watch for break above 2436.75 or below 2430.00 for change of fortunes
  • No Key economic data due:

Markets Around The World

  • Markets in the East closed mixed – Shanghai, Tokyo, Sydney and Seoul were up; Hong Kong and Mumbai were down
  • European markets are lower
  • Dollar index is down; USD/JPY, GBP/USD and EUR/USD are up
  • Commodities are higher
  • 10-yrs yield closed at 2.153% on June 22 down from June 21 close of 2.155%; 30-years closed at 2.724% unchanged

Key Levels:

  • Critical support levels for S&P 500 are 2430.74,2422.88 and 2418.53
  • Critical resistance levels for S&P 500 are 2441.46, 2447.90 and 2453.82
  • Key levels for eMini futures: break above 2436.75, the high of 4:30 AM and break below 2430.00, the low of 6:15 AM

Pre-Open

  • On Thursday, at 4:00 PM, S&P future (September contract) closed at 2432.00 and the index closed at 2434.50 – a spread of about 2.50 points; futures closed at 2431.75 for the day; the fair value is +0.25
  • Pre-NYSE session open, futures price action is mixed – at 8:15 AM, S&P 500 futures were up by +1.00; Dow down by -25.00; and NASDAQ down by -2.00

Directional Bias Before Open

  • Weekly: Up
  • Daily: Up
  • 120-Min: Side
  • 30-Min: Side

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, Friday June 16 was an almost doji with small upper and lower shadows
  • Last week’s pivot point 2431.81; R1=2445.09, R2=2457.03; S1=2419.87, S2=2406.87
  • An up week – third in last five weeks; sixth in last ten weeks
  • Broke above a down sloping flag (2378.36) on April 24, which has bullish implications; first target is near 2520.00 and the second target is near 2640.00
  • Broke above a down-sloping flag on November 14, 2016; first target of 2285.92 is achieved; second target is near 2467.50
  • Last swing low, 2322.25, was the low on March 27, 2017
  • Above 39-week SMA, 89-week SMA and 10-week SMA
  • Confirmed uptrend, though pulling back
Daily
  • A small red spinning top candle with small body and small upper shadow and smaller lower shadows; break below Wednesday’s low of 2430.74 will be bearish
  • Above a horizontal channel – high 2400.58 and low 2322.25 – 100% extension target near 2480.00
  • Above 20-day, 50-day EMA, 100-day and 200-day
  • Confirmed uptrend
2-Hour (e-mini future)
  • Mostly sideways move since 4:00 PM on June 20 in the middle of an emerging broadening pattern after breaking above it on June 19
  • Higher highs and higher lows since 10:00 AM on June 12
  • At or below flattening 20-bar EMA, which is below flattening 50-bar EMA
30-Minute (e-mini future)
  • Sideways move since 3:30 PM on June 20 within a narrow range – high 2440.00; low 2428.00
  • Fallen back into the horizontal channel that it broke above at 10:00 AM on June 19
  • At or below flattening 20-bar EMA, which is below flattening 50-bar EMA

Previous Session

Major U.S. indices were mixed on Thursday June 22. NASDAQ Composite, Russell 2000, Dow Transportation Average, NYSE Composite and Wilshire 5000 Total Market Index advanced. Dow Jones Industrial Average and S&P 500 declined. All declined in the last hour of trading to shed most for the gains of the day.

Six S&P 500 sectors declined – Consumer Discretionary and Staples, Energy, Industrial, Finance and Utility. Biotech gained +1.3%.

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