Market Remarks

Morning Notes – Monday October 30, 2017

Sunil Sharma

Directional Bias For The Day:

  • S&P Futures are lower
  • Moving mostly sideways-to-lower since the high of 2580.75 at 2:00 PM on October 27
  • Odds are for a down to sideways day – watch for break above 2575.00 and below 2471.00 for change of fortunes
  • Key economic data due:
    • Core PCE (0.1% vs. 0.1% est.) at 8:30 AM
    • Personal Spending (1.0% vs. 0.8% est.) at 8:30 AM

Markets Around The World

  • Markets in the East closed mostly higher –  Shanghai and Hong Kong were down
  • European markets are mostly higher – U.K. and Switzerland are down; Germany and France are mostly flat since the morning session on October 27; Spain and Switzerland are rising since the morning; Italy is mostly flat since the open
  • Currencies:
    Up Down
    • EUR/USD
    • GBP/USD
    • USD/CHF
    • USD/CAD
    • Dollar index
    • USD/JPY
    • AUD/USD
    • NZD/USD
  • Commodities are mostly down
    Up Down
    • Crude Oil
    • NatGas
    • Gold
    • Palladium
    • Sugar
    • Silver
    • Copper
    • Platinum
    • Coffee
    • Cotton
    • Cocoa
  • 10-yrs yield is at 2.388% down from October 27 close of 2.428%; 30-years is at 2.905% down from 2.936%

Key Levels:

  • Critical support levels for S&P 500 are 2578.53, 2565.94 and 2559.80
  • Critical resistance levels for S&P 500 are 2582.98, 2587.39 and 2593.70
  • Key levels for eMini futures: break above 2575.00, the high of 4:30 AM and break below 2571.75, the low of 7:00 AM

Pre-Open

  • On Friday, at 4:00 PM, S&P future (December contract) closed at 2578.75 and the index closed at 2580.07 – a spread of about 1.25 points; futures closed at 2578.50 for the day; the fair value is +0.25
  • Pre-NYSE session open, futures price action is to the downside – at 9:00 AM, S&P 500 futures were down by -5.50; Dow by -63.00; and NASDAQ by -3.75

Directional Bias Before Open

  • Weekly: Up
  • Daily: Up
  • 120-Min: Up-to-Side
  • 30-Min: Up-to-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:
  • A near doji candle close to all time high;
  • Last week’s pivot point 2569.35; R1=2594.70, R2=2608.33; S1=2555.72, S2=2530.37; S1 was breached after three weeks
  • An up week – seventh in last five weeks; ninth 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 large body green candle that gapped up from previous one
  • 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=2576.66; R1=2587.39, R2=2593.70; S1=2570.35, S2=2559.62; R1/R2/R3 were breached
  • Confirmed Uptrend
2-Hour (e-mini future)
  • Drifting lower since the high of 2580.75 was made at 2:00 PM on October 27; nearing the 20-bar EMA
  • Broke below the 50-bar EMA and now back above it
  • Sequence of lower highs and lower lows since 6:00 PM October 22 has broken; a new reverse sequence hasn’t yet established
  • Above recently rising 20-bar EMA, which is above rising 50-bar EMA
30-Minute (e-mini future)
  • Sideway move since 10:00 PM on October 29, which has made the price to break below an uptrend line from the low of 2541.50 at 12:30 PM on October 25
  • At/below a flat 20-bar EMA, which is at/above a flat 50-bar EMA

Previous Session

Major U.S. indices advanced on Friday October 27. Dow Jones Industrial Average made a doji like pattern but others had larger green real body. S&P 500, NASDAQ Composite and Wilshire 5000 Total Market Index made all time highs.

For the week, indices closed mixed. Russell 2000, Dow Jones Transportation Average and NYSE Composite closed down for the week. S&P 500 made a near doji candle near the high for the week. Russell 200 and Wilshire 5000 Total Market Index also made near dojis.

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

 

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