Directional Bias For The Day:
S&P Futures are lower- Near a support after turning down from a strong resistance; break below 2813.00 will be more bearish
- Odds are for down day with increased volatility – watch for break above 2828.75 for a change of fortunes
- Key economic data due:
- Prelim Nonfarm Productivity (-0.1% vs. 0.8% est.) at 8:30 AM
- Prelim Labor Cost (2.06% vs. 0.9% est.) at 8:30 AM
- Unemployment Claims (230K vs. 237K est.) at 8:30 AM
- ISM Manufacturing PMI ( est. 58.7) at 10:00 AM
Markets Around The World
- Markets in the East closed mixed- Shanghai, Hong Kong and Mumbai were down; Tokyo, Sydney and Seoul were up
- European markets are mostly down – Spain and Italy are up
- Currencies:
| Up |
Down |
- EUR/USD
- GBP/USD
- USD/JPY
- USD/CAD
|
- Dollar index
- USD/CHF
- AUD/USD
- NZD/USD
|
- Commodities:
| Up |
Down |
- Crude Oil
- Palladium
- Sugar
- Cotton
- Cocoa
|
- NatGas
- Gold
- Silver
- Copper
- Platinum
- Coffee
|
- Bonds
- 10-yrs yield is at 2.739% up from January 31 close of 2.720%;
- 30-years closed at 2.963% up from 2.942%
- 2-years yield is at 2.145% up from 2.149%
- The 10-Year-&-2-Year spread is at 0.594 up from 0.571
Key Levels:
- Critical support levels for S&P 500 are 2813.04, 2807.54 and 2795.40
- Critical resistance levels for S&P 500 are 2833.38, 2839.26 and 2851.48
- Key levels for eMini futures: break above 2828.75, the high of 7:30 AM and break below 2813.00, the low of 2:30 PM on January 31
Pre-Open
- On Wednesday , at 4:00 PM, S&P future (March contract) closed at 2825.75 and the index closed at 2823.81 – a spread of about +1.50 points; futures closed at 2825.75 for the day; the fair value is -0.00
- Pre-NYSE session open, futures price action is to the downside – at 8:45 AM, S&P 500 futures were down by -7.75; Dow by -145.00; and NASDAQ by -34.25
Directional Bias Before Open
- Weekly: Up
- Daily: Up
- 120-Min: Up-Side
- 30-Min: Down
- 15-Min: Down
- 6-Min: Down
The trend and patterns on various time frames for S&P 500 are:
| Monthly |
- Confirmed Uptrend
- December 2017 closed higher; index has been higher for the nine straight months; it has only one down month, March 2017, since October 2016
- Uptrend resumption since Feb 08, 2016 after a pull back of -15.2%
|
| Weekly: |
- The week ending on January 26 was a large body green candle, with almost no upper and lower shadows
- Last week’s pivot point 2851.29 R1=28294.45 R2=2916.04; S1=2829.70, S2=2786.54; R1/R2/R3 were breached;
- An up week; fourth in last five weeks and ninth in last ten weeks
- Broke above a down sloping flag on April 24 2017;
- flag-low was 2322.25 during 27-Mar-17 week; shorter flag-pole length is 317.19 and longer flag-pole length is 590.88;
- 100% extension target of shorter flag-pole near 2639.41 is achieved; and the 161.8% extension target is near 2835.46
- 61.8% extension target of longer flag-pole near 2687.41 is achieved; the 100% extension target is near 2913.13
- Broke above a down-sloping flag on November 14, 2016;
- the flag low was 2083.79 during 31-Oct-16 week; the shorter flag-pole length is 202.13 and the longer flag-pole length is 383.71;
- 261.8% extension target of shorter flag-pole near 2612.97 is achieved
- the 161.8% extension target of longer flag-pole near 2704.63 is achieved; the 261.8% extension target is near 3088.34
- 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
|
- Confirmed Uptrend
- Gap created on January 30 is still active; gap low at 2837.75, the January 30 low, and gap high at 2851.48, the January 29 low
- Last big pattern, a down-sloping flag in June 2017, was broken to the upside on July 13, 2017; in August the index declined and tested the broken upper limit of the flag; since then the index has made three very small flags; it broke to the upside of the last flag on January 2
- Above 20-day EMA but above 50-day EMA; Above 100-day SMA and 200-day SMA
|
| 2-Hour (e-mini future) |
- Again falling below the horizontal channel that was broken to the upside once and downside once; EMA20 and EMA50 acting as resistance
- RSI-9 dipped below 20 and the bounce up found resistance near 50 and is below 50
- Sequence of higher highs and higher lows since 10:00 AM on November 2 and since August 29 with few exceptions; again under pressure
- Below 20-bar EMA, which is below EMA10 of EMA50
- Bias: Up-Side
|
| 30-Minute (e-mini future) |
- Finding resistance at the down trend line from the high, which also formed a confluence of resistance that includes broken uptrend line and few broken supports and resistance highs
- An up-sloping flag that is broken to the downside is still active; down side target near 2779.00
- RSI-14 is in downtrend and making lower highs
- Below 20-bar EMA which is below 50-bar EMA
- Bias: Down
|
| 15-Minute (e-mini future) |
- Bollinger Band (20, 2.0) is mostly down since January 29; an up-sloping flag on BB is forming
- The band contracted during Asian session but is expanding since 4:00 AM with price hugging the lower band
- The Stochastic (9, 1, 3): %K hovering around the 20 level
- Bias: Down
|
Previous Session
Major U.S. indices closed mixed on Wednesday January 31 but the price action was not bullish. Indices closed lower than the open and the gap, that was opened on Tuesday, was not closed.
| Up |
Down |
- Energy
- Materials
- Industrials
- Finance
- Technology
- Utility
- Real Estate
- Telecom
|
- Consumer Discretionary
- Consumer Staples
- Heath Care
|
Major U.S. indices closed mixed on Wednesday January 31 but the price action was not bullish. Indices closed lower than the open and the gap, that was opened on Tuesday, was not closed.
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