Morning Notes – Thursday November 9, 2017

/ November 9, 2017

Directional Bias For The Day:

  • S&P Futures are down
  • Drifting down since 9:00 PM on Wednesday
  • Odds are for a down day – watch for break above 2583.50 and below 2582.25  for change of fortunes
  • Key economic data:
    • Unemployment Claims (239K vs. 232K Est.) at 8:30 AM

Markets Around The World

  • Markets in the East closed mostly higher – Tokyo and Seoul were down
  • European markets are lower
  • Currencies:
    Up Down
    • EUR/USD
    • Dollar index
    • USD/JPY
    • GBP/USD
    • USD/CHF
    • AUD/USD
    • NZD/USD
    • USD/CAD
  • Commodities:
    Up Down
    • Crude Oil
    • NatGas
    • Gold
    • Palladium (unch.)
    • Coffee
    • Cotton (unch.)
    • Silver
    • Copper
    • Platinum
    • Sugar
    • Cocoa
  • 10-yrs yield is at 2.340% up from November 8 close of 2.325%; 30-years is at 2.810% up from 2.784%

Key Levels:

  • Critical support levels for S&P 500 are 2584.35, 2581.98 and 2574.29
  • Critical resistance levels for S&P 500 are 2595.47, 2602.07 and 2608.68
  • Key levels for eMini futures: break above 2579.75, the low of 6:30 PM on November 7 and break below 2575.50, the low of 10:00 PM on November 5

Pre-Open

  • On Wednesday, at 4:00 PM, S&P future (December contract) closed at 2591.50 and the index closed at 2594.38 – a spread of about 3.25 points; futures closed at 2591.00 for the day; the fair value is +0.50
  • Pre-NYSE session open, futures price action is to the down side – at 9:00 AM, S&P 500 futures were down by -13.50; Dow by -93.00; and NASDAQ by -52.25

Directional Bias Before Open

  • Weekly: Up
  • Daily: Up
  • 120-Min: Up
  • 30-Min: Side-to-Down
  • 15-Min: 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 shaved top doji candle with lower shadow almost equal to real body
  • Last week’s pivot point 2580.81; R1=2595.45, R2=2603.06; S1=2573.20, S2=2558.56; No levels were breached weeks
  • An up week – eighth 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 bullish engulfing candle that did not go higher than Tuesday’s 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=2591.62; R1=2598.23, R2=2602.07; S1=2587.78, S2=2581.17; No levels were breached
  • Confirmed Uptrend
2-Hour (e-mini future)
  • Drifting down since the high of 2594.50 at 8:00 PM on Wednesday; a double top forming; Asian session high breached the pervious high but then closed down
  • Above an uptrend line since the low of 2541.50 at 12:00 PM on October 25; two touches; breaking below it; the 6:00 AM candle is forming a dragonfly doji
  • Sequence of higher highs and higher lows since 10:00 AM on November 2 and since August 29 with few exceptions; potential break in the sequence
  • Below 50-bar EMA, which is below 20-bar EMA
30-Minute (e-mini future)
  • Declining since 8:30 PM on November 8; got rejected at 20-bar EMA at 2:30 AM;
  • Broken below the lower limit of a horizontal channel / double top – high 2593.50 and low 2579.75; 100% extension is near 2566.00, 61.8% extension near 2571.25 and 38.2% extension at 2574.50; attempting to bounce the support near 2575.50, the low reached at 6:30 on November 7 and a congestion area on November 6
  • Below a drooping 20-bar EMA, which is below a drooping 50-bar EMA
15-Minute (e-mini future)
  • Downtrend since 9:00 PM n November 8
  • Below the lower bound of the envelop (20 – 17%) and Bollinger Band (20 – 2 std dev)
  • Below a drooping 20-bar EMA, which is below a drooping 50-bar EMA

Previous Session

Most major U.S. indices closed higher on Wednesday November 8. Dow Jones Transportation Average closed down. The day’s range was small and market moved up during the day gradually and persistently, it was very convincing. Dow Jones Industrial Average made a doji. S&P 500 and NASDAQ composite made bullish engulfing but they could not go higher than Tuesday’s high. DJT continues its break down.

Russell 2000 made a hammer pattern. NYSE Composite and Wilshire 5000 Total Market Index made piercing like patterns. Wednesday’s market action makes Thursday’s price action critical for clues about market’s near term direction.

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

 

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