Morning Notes – Thursday September 28, 2017

/ September 28, 2017

Directional Bias For The Day:

  • S&P Futures are lower
  • New leg down at 7:30 Am after a sideway move from 6:00 PM on September 27; an ABCD pattern; price near the 100% extension target of 2498.25
  • Odds are for a down day – watch for break above 2505.50 for change of fortunes
  •  Key economic data due:
    • Final GDP (3.1% vs. 3.0% est.) at 8:30 AM
    • Unemployment Claims (272K vs. 269K est.) at 8:30 AM

Markets Around The World

  • Markets in the East closed mostly up – Shanghai and Hong Kong were down; the intra-day trend was mixed; most rose late in the day
  • European markets are mixed – Germany, France and Switzerland are up; U.K., Spain, Italy and STOXX 600 are down; down; intraday trend is similar
  • Currencies:
    Up Down
    • EUR/USD
    • GBP/USD
    • USD/CHF
    • Dollar index
    • USD/JPY
    • USD/CAD
    • AUD/USD
    • NZD/USD
  • Commodities are mostly down
    Up Down
    • Crude Oil
    • NatGas
    • Copper
    • Platinum
    • Palladium
    • Cocoa
    • Gold
    • Silver
    • Sugar
    • Coffee
    • Cotton
  • 10-yrs yield closed at 2.309% on September 27 up from September 26 close of 2.229%; 30-years closed at 2.863% up from 2.770%

Key Levels:

  • Critical support levels for S&P 500 are 2495.91, 2488.03 and 2480.99
  • Critical resistance levels for S&P 500 are 2511.75, 2513.89 and 2520.74
  • Key levels for eMini futures: break above 2505.50, the high of 1:30 AM and break below 2498.75, the low of 1:00 PM on September 27

Pre-Open

  • On Wednesday, at 4:00 PM, S&P future (December contract) closed at 2504.50 and the index closed at 2507.04 – a spread of about 2.50 points; futures closed at 2504.50 for the day; the fair value is 0.00
  • Pre-NYSE session open, futures price action is to the downside – at 8:15 AM, S&P 500 futures were down by -5.25; Dow down by -46.00; and NASDAQ by -23.75

Directional Bias Before Open

  • Weekly: Up
  • Daily: Up
  • 120-Min: Side
  • 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 day’s 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 green doji like candle on a positive day that made all time highs; the real body is in the middle of day’s range
  • 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=2504.90; R1=2513.89, R2=2520.74; S1=2498.05, S2=2489.06; R1/R2/R3 were breached
  • Confirmed Uptrend
2-Hour (e-mini future)
  • Near the upper  limit of a horizontal channel after a break above it for one bar; broken above the downtrend line since high of 2506.75 at 2:00 PM on September 20;
  • Sequence of higher high and higher low since 12:00 PM September 5 could resume
  • At/below flattening 20-bar EMA, which is above rising 50-bar EMA
30-Minute (e-mini future)
  • Moving mostly sideways since 6:00 PM on September 27
  • Broke above a horizontal channel in two attempts; achieved 100% extension target
  • Up trend since the of low of 2485.00 at  11:00 AM on September 25;
  • Above recently rising 20-bar EMA, which is above recently rising 50-bar EMA

Previous Session

Major U.S. indices closed sharply higher on Wednesday September 27. S&P 500, Dow Transportation Average, Russell 2000, NYSE Composite and Wilshire 5000 Total Market Index made all time highs. Only S&P 500 did not make a closing high. Dow Jones Industrial Average and NASDAQ Composite did not make highs.

Market started the day with a gap up open but then gave all of that by mid-morning. The second rally started in the afternoon before pulling back in the last half hour of trading.

 

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

 

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