Morning Notes – Monday June 26, 2017

/ June 26, 2017

Directional Bias For The Day:

  • Futures are higher
  • S&P Futures broke above a horizontal channel / ascending triangle at European session open at 3:00 AM; target is near 2449.00
  • Odds are for an up day; watch for break below 2439.00 for change of fortunes
  • Key economic data due:
    • Durable Goods Orders (0.1% vs. 0.4% est.) at 8:30 AM
    • Core Durable Goods Orders (-1.1% vs. -0.5% est.) at 8:30 AM

Markets Around The World

  • Markets in the East advanced – Mumbai was closed
  • European markets are higher
  • Dollar index is down; USD/JPY, GBP/USD and EUR/USD are up
  • Commodities are mixed – crude oil, NatGas and copper are higher; gold and silver are lower
  • 10-yrs yield closed at 2.144% on June 23 down from June 22 close of 2.153%; 30-years closed at 2.714% down from 2.724%

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 2441.62, 2447.90 and 2453.82
  • Key levels for eMini futures: break above 2443.25, the high of 8:30 AM on June 14 and break below 2439.00, the low of 4:00 AM

Pre-Open

  • On Friday, at 4:00 PM, S&P future (September contract) closed at 2435.50 and the index closed at 2438.30 – a spread of about 3.00 points; futures closed at 2435.00 for the day; the fair value is +0.50
  • Pre-NYSE session open, futures price action is to the upside – at 8:30 AM, S&P 500 futures were up by +6.25; Dow by +63.00; and NASDAQ by +26.50

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 shadow and smaller lower shadow
  • Last week’s pivot point 2440.95; R1=2451.17, R2=2464.03; S1=2428.09, S2=2417.87
  • An up week – fourth in last five weeks; seventh 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 green spinning top candle with small body and small upper shadow and smaller lower shadow; third is row such candle indicating indecision
  • 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)
  • Moving mostly sideways since 4:00 PM on June 20;  in the middle of an emerging broadening pattern but perceptibly moving to the upper limit
  • Higher highs and higher lows since 10:00 AM on June 12
  • Above recently rising 20-bar EMA, which is above 50-bar EMA
30-Minute (e-mini future)
  • Broke above an ascending triangle at 3:00 AM; the target is near 2449.00
  • Sideways move from 3:30 PM on June 20 to 3:00 Am within a narrow range – high 2440.00; low 2428.00
  • Above rising 20-bar EMA, which is above rising 50-bar EMA

Previous Session

Major U.S. indices mostly advanced on Friday June 23. Dow Jones Industrial Average decline making a near doji candle.

NASDAQ Composite, Russell 2000 and Dow Transportation Average made slightly larger real body candles. S&P 500 , NYSE Composite and Wilshire 5000 Total Market Index made small spinning top candles.

Four S&P 500 sectors declined – Consumer Discretionary, Finance, Utility and Healthcare. Energy was the best sector with +0.7% advance followed by Technology at +0.6%. Oil & Gas gained +0.9% and computers +0.7%.

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