Morning Notes – Friday September 8, 2017

/ September 8, 2017

Directional Bias For The Day:

  • S&P Futures are lower
  • Moving down since the double top at 9:30 AM on September 7 high of 2469.00
  • Horizontal channel emerging on 30-minute; near the lower limit of the pattern
  • Odds are for a down day – watch for break above 2462.50 for a change of fortunes
  • No Key economic data due

Markets Around The World

  • Markets in the East closed mixed – Shanghai, Tokyo and Sydney were down; Hong Kong and Mumbai were up; were down; most trended down during the day; Hong Kong and Mumbai moved sideways
  • European markets are mixed – Germany, Spain, Italy and Switzerland are up; U.K., France and STOXX 600 are down; most are trending down for the day – Italy and Switzerland are trending up
  • Currencies:
    Up Down
    • EUR/USD
    • GBP/USD
    • AUDUSD
    • NZD/USD
    • Dollar index
    • USD/JPY
    • USD/CHF
    • USD/CAD
  • Commodities are mostly up
    Up Down
    • Gold
    • Silver
    • Platinum
    • Palladium
    • Sugar
    • Coffee
    • Cotton
    • Cocoa
    • Crude Oil
    • NatGas
    • Copper
  • 10-yrs yield closed at 2.061% on September 7 down from September 6 close of 2.108%; 30-years closed at 2.677% down from 2.724%

Key Levels:

  • Critical support levels for S&P 500 are 2460.29, 2452.82 and 2446.55
  • Critical resistance levels for S&P 500 are 2471.97, 2480.38 and 2490.87
  • Key levels for eMini futures: break above 2462.50, the high of 5:30 AM and break below 2456.75, the low of 6:30 AM

Pre-Open

  • On Thursday, at 4:00 PM, S&P future (September contract) closed at 2464.50 and the index closed at 2465.10 – a spread of about 0.50 points; futures closed at 2466.50 for the day; the fair value is -2.00
  • Pre-NYSE session open, futures price action is to the downside – at 7:30 AM, S&P 500 futures were down by -9.50; Dow down by -114.00; and NASDAQ by -9.75

Directional Bias Before Open

  • Weekly: Up
  • Daily: Up-to-Side
  • 120-Min: Side-to-up
  • 30-Min: Side-to-Down

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:
  • A large green body candle closing near the high for the week ending on Friday September 1; almost ten points below all time high of 2490.87 reached during the week ending on August 11
  • Last week’s pivot point 2461.71; R1=2495.22, R2=2513.89; S1=2443.04, S2=2409.53
  • An up week – second in a row and third in last five weeks; sixth in last ten weeks
  • R1 and R2 of previous week broken after two weeks; S1 and S2 have not been broken for the last two 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
  • Closed above 10-week EMA, 39-week SMA and 89-week SMA
  • Confirmed uptrend, though pulling back
Daily
  • A small red harami candle, almost a doji, with lower shadow larger than upper shadow; another indecisive day;
  • Last pattern, a down-sloping flag in June that was broken to the upside on July 13, is nullified when price broke below 2430.00; the index was below 2430.00 for only one day
  • Above 20-day EMA, which is above 50-day EMA; Above 100-day SMA and 200-day SMA
  • Pivot Point=2464.67; R1=2469.05, R2=2473.00; S1=2460.72, S2=2456.34
  • None of the support or resistance levels were breached
  • Uptrend under pressure; mostly moving sideways since June 2 between 2490.00 and 2410.00
2-Hour (e-mini future)
  • Futures drifting down since making a double top at 8:00 AM on September 7
  • Lower highs and lower lows since 12:00 PM on September 1; sequence will break with a rise above 2471.25
  • Below flat 20-bar EMA, which is below flat 50-bar EMA
30-Minute (e-mini future)
  • An upside down arc forming since September 5; near the low of 8:00 PM on September and 5:30 AM of September 6 near 456.50
  • Mostly moving sideways with a downward bias since 4:00 PM on September 5; a horizontal channel – high of 2469.00 and low of 2456.50 – is emerging; near the lower limit of the channel; a break below will have an 100% extension is near 2444.00; 161.8% extension is near 2436.25
  • Broken below an up-sloping flag; achieved first target, 100% extension, and the second, 138.2% extension; the 161.8% target is near 2439.75
  • Below recently falling 20-bar EMA, which is below recently falling 50-bar EMA

Previous Session

Major U.S. indices closed mixed on Thursday September 7. Dow Jones Industrial Average, S&P 500, Russell 2000 and Wilshire 5000 Total Market Index closed lower. NASDAQ Composite, Dow Jones Transportation Average and NYSE Composite closed higher.

The range was small and many made another almost doji like patterns. The range for most was also within the real body of Tuesday, September 6. Russell 2000 tested the low of Tuesday and DJT tested the high.

Only two S&P 500 sectors – Consumer Discretionary and Finance – were down Thursday.

 

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