Morning Notes – Monday September 18, 2017

/ September 18, 2017

Directional Bias For The Day:

  • S&P Futures are higher
  • Moving sideways to down since 1:00 AM
  • Odds are for an up to sideways day – watch for break below 2500.50 for a change of fortunes
  • No Key economic data due:

Markets Around The World

  • Markets in the East closed higher – Tokyo was closed; the intra-day trend up in the early session followed by a consolidation and little pullback
  • European markets are higher; markets opened at the high and have been pulling back since then
  • Currencies:
    Up Down
    • EUR/USD
    • GBP/USD
    • USD/CAD
    • Dollar index
    • USD/JPY
    • USD/CHF
    • AUD/USD
    • NZD/USD
  • Commodities are mostly down
    Up Down
    • NatGas
    • Copper
    • Palladium
    • Cotton
    • Crude Oil
    • Gold
    • Silver
    • Platinum
    • Coffee
    • Cocoa
  • 10-yrs yield is at 2.215% up from September 15 close of 2.202%; 30-years is at 2.770% up from 2.771%

Key Levels:

  • Critical support levels for S&P 500 are 2496.20, 2491.35 and 2486.17
  • Critical resistance levels for S&P 500 are 2502.59, 2504.94 and 2509.66
  • Key levels for eMini futures: break above 2504.50, the high of 3:00 AM and break below 2500.50, the low of 9:00 PM on September 17

Pre-Open

  • On Friday, at 4:00 PM, S&P future (December contract) closed at 2497.50 and the index closed at 2500.23 – a spread of about 2.75 points; futures closed at 2497.25 for the day; the fair value is +0.25
  • Pre-NYSE session open, futures price action is to the upside – at 9:00 AM, S&P 500 futures were up by +4.25; Dow by +46.00; and NASDAQ by +4.75

Directional Bias Before Open

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

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 green shaven top and shaven bottom candle that gapped up from previous red harami candle; all time highs after a brief – seven week pullback
  • Last week’s pivot point 2491.66; R1=2508.80, R2=2517.37; S1=2483.09, S2=2465.95; R1/R2/R3 were breached; support levels not breached for four weeks
  • 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 10-week EM; above 39-week SMA and 89-week SMA
  • Confirmed uptrend, though pulling back and moving sideways since June 5
Daily
  • A small green candle that broke above a trading range in the afternoon session; new high
  • Last pattern, a down-sloping flag in June that was broken to the upside on July 13, is re-asserted
  • Above 20-day EMA, which is above 50-day EMA; Above 100-day SMA and 200-day SMA
  • Pivot Point=2497.87; R1=2502.59, R2=2504.94; S1=2495.52, S2=2490.80; R1 was breached
  • Uptrend resumed
2-Hour (e-mini future)
  • Futures moving higher since 12:00 PM on September 11; between high near 2495.00 and low near 2487.00
  • Sequence of higher high and higher low since 12:00 PM September 5
  • Above rising 20-bar EMA, which is above rising 50-bar EMA
30-Minute (e-mini future)
  • Drifting down since 2:30 AM; broke above a congestion zone at 10:a0 AM on September 15
  • High highs and higher lows, with couple of exceptions, since 5:00 AM on August 29
  • Below a flattening 20-bar EMA, which is above rising 50-bar EMA

Previous Session

Major U.S. indices closed higher on Friday September 15. The market was moving sideways till 10:00 AM before breaking away a range that was being formed since 9:30 AM on Tuesday. Most indices made all time highs. Russell 2000 and Dow Jones Transportation Average did not but they are also breaking above a recent congestion area.

  • S&P 500 Sectors
Up Down
  1. Technology
  1. Consumer Discretionary
  2. Consumer Staples
  3. Energy
  4. Materials
  5. Industrials
  6. Finance
  7. Utility
  8. Heath Care
  9. Real Estate

For the week; all major indices were up. All but two S&P 500 sectors were up. Utility and Real Estate were down for the week.

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