Morning Notes – Friday November 17, 2017

/ November 17, 2017

Directional Bias For The Day:

  • S&P Futures are slightly lower
  • Moved lower from 2:00 PM on Thursday high of 2589.50 to 4:00 AM low of 2579.50; then drifted higher to 2585.50 by 7:30 AM; now again moving down
  • Broke above a down trend line at 6:30 AM; broke below an up trend line from November 15 low at midnight, it is acting as a resistance
  • Odds are for a sideway day – watch for break below 2579.50 and break above 2586.00 for change of fortunes
  • Key economic data due:
    • Building Permits ( 1.30M vs. 1.25M) at 8:30 AM
    • Hosing Start (1.29M vs. 1.19M) at 8:30 AM
    • Import Prices (0.2% vs. 0.4% est.) at 8:30 AM
    • Mortgage Delinquencies at 10:00 AM

Markets Around The World

  • Markets in the East closed mostly higher – Shanghai and Seoul closed down
  • European markets are mixed – Germany, U.K., France and Switzerland are up; Spain, Italy and STOXX 600 are down
  • Currencies:
    Up Down
    • EUR/USD
    • GBP/USD
    • USD/CAD
    • Dollar index
    • USD/JPY
    • USD/CHF
    • AUD/USD
    • NZD/USD
  • Commodities:
    Up Down
    • Crude Oil
    • Gold
    • NatGas
    • Silver
    • Palladium
    • Cocoa (unch.)
    • Copper
    • Sugar
    • Coffee (unch.)
    • Cotton
  • 10-yrs yield closed at 2.361% on November 16 up from November 15 close of 2.335%; 30-years closed at 2.806% down from 2.781%

Key Levels:

  • Critical support levels for S&P 500 are 2579.66, 2572.95 and 2563.30
  • Critical resistance levels for S&P 500 are 2590.09, 2595.47 and 2597.02
  • Key levels for eMini futures: break above 2586.00, the high of 6:00 PM on November 16 and break below 2579.50, the low of 4:00 AM

Pre-Open

  • On Thursday, at 4:00 PM, S&P future (December contract) closed at 2584.75 and the index closed at 2585.64 – a spread of about 1.00 points; futures closed at 2585.00 for the day; the fair value is -0.25
  • Pre-NYSE session open, futures price action is to the down side – at 8:30 AM, S&P 500 futures were down by -1.25; Dow by 39.00; and NASDAQ is up by +3.50

Directional Bias Before Open

  • Weekly: Up
  • Daily: Up
  • 120-Min: Down-to-Side
  • 30-Min: Up-to-Side
  • 15-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 spinning top candle with almost equal length upper and lower shadows
  • Last week’s pivot point 2581.88; R1=2597.44, R2=2612.57; S1=2566.75, S2=2551.19; R1/ and S1 were breached
  • A down week – first in last five weeks; second 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 green candle that gapped up above a red spinning candle effectively making a morning start patter but after a short decline; breaking above a down-sloping flag
  • RSI-14 divergence – on October 20 the RSI was 79.65 and the 2578,29, on November 8 the high was 2595.47 and the RSI was 72.50
  • Last pattern, a down-sloping flag in June that was broken to the upside on July 13
  • Above 20-day EMA but above 50-day EMA; Above 100-day SMA and 200-day SMA
  • Pivot Point=2582.89; R1=2592.84, R2=2600.03; S1=2575.70, S2=2565.75; R1/R2/R3 were breached
  • Confirmed Uptrend
2-Hour (e-mini future)
  • Bounced off the support of 2555.50 at 8:00 AM on November 15 near the resistance of 2590.50;
  • Broken below the lower limit of a horizontal channel / double top – high 2593.50 and low 2579.75; 100% and 161.8% extension were achieved
  • Sequence of higher highs and higher lows since 10:00 AM on November 2 and since August 29 with few exceptions is broken again
  • Above rising 20-bar EMA, which is above a rising 50-bar EMA
30-Minute (e-mini future)
  • Breaking above a down trend lien from high of Thursday
  • Above a rising 20-bar EMA, which is above a rising 50-bar EMA
15-Minute (e-mini future)
  • Envelop and Bollinger Band are sloping down since 8:00 PM on Thursday
  • Near the upper bounds of the Bollinger Band  (20-2 std dev)
  • Moving up from the middle of the envelop (20 – 0.247%)
  • Above 20-bar EMA, which is at 50-bar EMA

Previous Session

Major U.S. indices closed higher on Thursday November 16. The indices gapped up at the open and then stayed above the gap for the rest of the day with a small retracement in the final hour of trading.

Dow Jones Industrial Average, S&P 500, NASDAQ Composite and Wilshire 5000 Total Market Index are breaking above a short down-sloping flag.

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

 

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