Market Remarks

Morning Notes – Friday, November 12, 2021

Sunil Sharma

Directional Bias For The Day:

  • S&P Futures are higher at 8:30 AM; moving up since 4:30 AM to a resistance level around 4660.00
  • The odds are for an up day – watch for a break below 4650.25 for a chan of fortunes
  • Key economic data report due during the day:
    • JOLTS Job Openings
    • Prelim UoM Consumer Sentiment ( 72.5 est.; prev. 71.7) at 10:00 AM
    • Prelim UoM Inflation Expectations ( prev. 4.8%) at 10:00 AM

Directional Bias Before Open:

  • Weekly: Uptrend
  • Daily: Uptrend Resumed
  • 120-Min: Up-Side
  • 30-Min: Down-Side
  • 15-Min: Down-Side
  • 6-Min: Up

Key Levels:

  • Critical support levels for S&P 500 are 4648.31, 4640.49, and 4630.86
  • Critical resistance levels for S&P 500 are 4664.55, 4686.51, and 4691.32
  • Key levels for E-mini futures: break above 4658.25, the high of 7:30 PM and break below 4650.25, the low of 8:00 AM

Pre-Open

  • On Thursday at 4:00 PM, S&P futures (December 2021) closed at 4642.75 and the index closed at 4649.27 – a spread of about -6.50 points; futures closed at 4643.00 for the day; the fair value is -0.25
  • Pre-NYSE session open, futures are higher – at 8:45 AM, S&P 500 futures were up by +11.50; Dow by +112; and NASDAQ by +43.50

Markets Around The World

  • Markets in the East closed mostly higher – Singapore closed lower
  • European markets are mostly higher – the UK and Spain are down;
  • Currencies (Compared to two weeks ago):
    Up Down
    • Dollar index
    • USD/JPY
    • USD/CHF
    • USD/CAD
    • EUR/USD
    • GBP/USD
    • AUD/USD
    • NZD/USD
    • INR/USD
  • Commodities (Compared to two weeks ago):
    • Energy futures are lower
    • Precious metals are higher
    • Industrial metals are mostly higher
    • Soft commodities are mostly higher
  • Treasuries (Compared to two weeks ago)
    • 10-years yield closed at 1.560%, down -0.8 basis points from two weeks ago;
    • 30-years is at 1.916%, down -4.7 basis points;
    • 2-years yield is at 0.515%, up +3.0 basis points;
    • The 10-Year-&-2-Year spread is at 1.045, down from 1.083
    • The 30-Year-&-10-Year spread is at 0.356, down from 0.395
  • VIX
    • At 17.28 @ 8:15 AM; down from the last close; below 5-day SMA;
    • Recent high = 24.89 on October 1; low =  14.73 on November 4
    • Sentiment: Risk-On

The trend and patterns on various time frames for S&P 500:

Monthly
  • October 2021 was a Bullish Engulfing candle with  small lower shadow and almost no upper shadow; at all-time closing and intra-month highs;
    • Stochastic (9, 1, 3): %K above %D; near 100;
    • RSI-9 is turning up; above 75
    • Above the upper band of a 120-month regression channel;
  • Confirmed Uptrend: sequence of higher highs and higher lows
Weekly:
  • The week ending on November 5 a relatively larger green candle at all-time highs
    • Stochastic (9,1, 3): %K is above %D; above 90
    • RSI-9 is above 70
  • The week was up +60.48 or +1.3%; the 5-week ATR  is 129.73
  • An up week; fourth in the last five weeks, and seventh in the previous ten weeks
  • The weekly pivot point=4583.61, R1=4629.85, R2=4654.33; S1=4559.13, S2=4512.89; R1 pivot level was breached
  • Above 10-week EMA; above 39-week SMA; above 89-week SMA
  • Uptrend Resumed
Daily
  • A small red Harami candle within a red spinning top candle;
    • Stochastic (9, 1, 3): %K is below %D; near 40
    • RSI-9 is just above 60; below 8-day EMA
  • Above 20-day EMA, 50-day EMA, 100-day SMA, and 200-day SMA
  • Uptrend Resumed
2-Hour (E-mini futures)
  • Trending up since October 1 in steps; drifting down since 8:00 AM on November 8
    • RSI-21 declined from 85 on November 5 to below 30 on November 10; bounced up above 50;
  • At/above EMA20, which is below EMA10 of EMA50
  • Bias: Up-Side
30-Minute (E-mini futures)
  • Moving down since 9:30 AM on November 8; moving sideways since 4:00 Am on November 11
    • RSI-21 moving along just above 50
    • Above EMA10 of EMA50, which is at/above EMA20
  • Bias: Down-Side
15-Minute (E-mini futures)
  • The Bollinger Band (20, 2.0) has been moving sideways since 9:00 PM on November 10;
  • The Bollinger Band is expanding slightly since 6:00 AM with price walking up the upper band;
    • Stochastic (9, 1, 3): %K is above %D at 8:45 AM;
  • Bias: Down-Side

Previous Session

Major U.S. indices closed mostly higher on Thursday, November 11, in lower volume. Dow Jones Industrial Average closed lower. Most major indices made Harami or similar indecisive candles The ay’s price range was muted and direction was mostly sideways.

From Briefing.com:

The S&P 500 increased 0.1% on Thursday in a tight-ranged session. The Nasdaq Composite (+0.5%) and Russell 2000 (+0.8%) outperformed the benchmark index with decent gains, while the Dow Jones Industrial Average fell 0.4%. […]

Six of the 11 S&P 500 sectors closed higher, while five closed lower. The materials (+0.9%) and information technology (+0.5%) sectors finished atop the standings with modest gains, while the communication services (-0.5%) and utilities (-0.6%) sectors underperformed. No sector gained or lost more than 1.0%.

[…]

Outside equities, the U.S. Dollar Index advanced 0.4% to 95.18. — its highest level since July 2020. WTI crude futures ($81.37/bbl, +0.20, +0.3%) inched higher after falling 3.5% yesterday.

[…]
  • S&P 500 +23.8% YTD
  • Nasdaq Composite +21.9% YTD
  • Russell 2000 +22.0% YTD
  • Dow Jones Industrial Average +17.4% YTD

Overseas: 

  • Europe: DAX +0.1%, FTSE +0.6%, CAC +0.2%
  • Asia: Nikkei +0.6%, Hang Seng +1.0%, Shanghai +1.2%

Commodities: 

  • Crude Oil +0.20 @ 81.37
  • Nat Gas +0.26 @ 5.25
  • Gold +15.10 @ 1864.60
  • Silver +0.62 @ 25.34
  • Copper +0.09 @ 4.40
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