Morning Notes – Friday October 20, 2017

/ October 20, 2017

Directional Bias For The Day:

  • S&P Futures are higher
  • Drifting down after rising sharply to 2571.75 during early Asian session; bouncing from Fibonacci 61.8% retracement level near 2464.00
  • Odds are for an up day – watch for break below 2463.75 for change of fortunes
  • Early session trading could be choppy
  • Key economic data due:
    • Existing Home Sales (est. 5.30M) at 10:00 AM

Markets Around The World

  • Markets in the East closed higher – Mumbai was closed; markets opened at the low and rose most of the trading session
  • European markets are higher – Germany, France, Switzerland and STOXX 600 opened at the high and are trending down since then; Spain and Italy are trending up
  • Currencies:
    Up Down
    • Dollar index
    • GBP/USD
    • USD/JPY
    • USD/CHF
    • USD/CAD
    • EUR/USD
    • AUD/USD
    • NZD/USD
  • Commodities are mostly down
    Up Down
    • NatGas
    • Copper
    • Palladium
    • Sugar
    • Cotton
    • Cocoa
    • Crude Oil
    • Gold
    • Silver
    • Platinum
    • Coffee
  • 10-yrs yield closed at 2.321% up from October 19 close of 2.339%; 30-years closed at 2.829% up from 2.850%

Key Levels:

  • Critical support levels for S&P 500 are 2558.14, 2547.92 and 2544.86
  • Critical resistance levels for S&P 500 are 2564.11, 2567.00 and 2571.90
  • Key levels for eMini futures: break above 2568.75, the high of 3:00 AM and break below 2563.75, the low of 4:30 AM

Pre-Open

  • On Thursday, at 4:00 PM, S&P future (December contract) closed at 2560.50 and the index closed at 2562.10 – a spread of about 1.50 points; futures closed at 2560.50 for the day; the fair value is 0.00
  • Pre-NYSE session open, futures price action is to the upside – at 8:15 AM, S&P 500 futures were up by +5.25; Dow by +79.00; and NASDAQ by +12.50

Directional Bias Before Open

  • Weekly: Up
  • Daily: Up
  • 120-Min: Up
  • 30-Min: 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 near doji candle with small range
  • Last week’s pivot point 2550.81; R1=2560.01, R2=2566.86; S1=2543.96, S2=2534.76; No levels were breached
  • An up week – fifth 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 10-week EM; above 39-week SMA and 89-week SMA
  • Confirmed uptrend
Daily
  • A green candle with no upper shadow and short lower shadow; closing just above Wednesday’s close
  • 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=2557.46; R1=2567.00, R2=2571.90; S1=2552.56, S2=2543.02; S1/S2/S3 were breached; supports were broken for the first time in five days; previous 3-support breaches were on September 25
  • Confirmed Uptrend
2-Hour (e-mini future)
  • On Thursday, bounced off the lower limit of horizontal channel that was broken to the upside on October 17; broken above the upper limit at 12:00 PM and reached the high of 25761.75 by 10:00 PM; retreating since then
  • Rose above the 50-bar EMA after closing below it for the first time since 10:00 PM on September 26; five bars closed below it
  • Sequence of higher high and higher low since 12:00 PM September 5 was broken but again reasserted
  • Above rising 20-bar EMA, which is above rising 50-bar EMA
30-Minute (e-mini future)
  • Drifting down since 10:00 PM on October 19; bouncing since 4:30 AM and now at the downtrend line
  • Rose sharply during 9:30 PM candle on October 19 – from a low of 2560.00 to a high of 2570.75; retreated to 61.8% Fibonacci retracement level near 2464.00
  • Above rising 20-bar EMA, which is above rising 50-bar EMA

Previous Session

Major U.S. indices closed mixed on Thursday October 19. S&P 500, Dow Jones Industrial Average, NYSE Composite and Wilshire 5000 Total Market Index closed up. NASDAQ Composite, Russell 2000 and Dow Jones Transportation Average closed down. Indices were negative for most for the day. they started the day with deep losses but then mostly rose during the day.

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

 

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