Market Diary – Friday, July 1, 2016

Directional Bias For The Day:


  • The bias is to the upside, albeit, modestly
  • Critical resistance levels for S&P 500 are 2113.32 and 2118.23;
  • Critical support levels for S&P 500 are 2089.27 and 2070.00
  • Early morning futures price action is indecisive.

Before NYSE Session Open

After witnessing the past three days’ market action, it seems that the Brexit never happened. However, considering the market trajectory before June 23rd referendum, the fact that UK-EU trade relationship will stay intact for at least two more years and the policy makers across the world are getting in overdrive to contain the damage, it is not surprising to find the market where it is.

On the last day of the quarter, Thursday June 30th, S&P 500 gained +28.09, Dow Jones Industrial Averages gained +235.31 and NASDAQ Composite was up by +63.42.

Asian Session

The Asian bourses were mostly up.

  • Shanghai Composite was again range bound for the day and closed up slightly by +0.10% at 2932.47; it continues to struggle to overcome the resistance of 2945.52, the high of June 2016;
  • Nikkei 225 gained +0.68%, but still made a harami candlestick pattern
  • Sydney’s S&P/ASX 200 gained +0.25% but closed off the high by 0.5%;
  • South Korea’s Kospi gained +0.72%;
  • Sensex continued its trend and broke the resistance and closed up by +0.54%

European Session

In pre-US session, European stock markets are mostly up.

  • DAX is up by +0.90% and is filling the gap created on Friday June 24th; STOXX 600 is up by +0.70%
  • FTSE-100 is up by +1.09% to 6576.06 following a gain of more than 140 on Thursday
  • CAC-40 is up by +0.92%; Italian FTSE MIB is up by +0.15%; Spanish IBEX-35 is up by +1.44% and Swiss SMI-SWX Is up by +0.71%; all are filling the Friday gap


  • U.S. Dollar index is down by -0.518 to 95.685 following a Bullish-Engulfing on Thursday
  • EUR/USD is up +48 pips to 1.1089; on daily timeframe it is making an up-sloping flag
  • GBP/USD is up by +18 pips in a strong downtrend
  • USD/JPY is slightly down by -60 pips (Yen is stronger); the trend is strongly down
  • Aussie and Kiwi dollars are up for the day by +44 and +54 pips


  • WTI Crude is down by -0.15 to 48.18, within a descending triangle at a resistance level; Natural Gas is down by -0.55% at a resistance level
  • Gold is up by +16.03 or +1.23% and Silver is up by +0.667 or +3.58%
  • Copper is down by -0.015 or -0.68%


  • U.S. Treasury yields are down for the day; 30-years is down by -84 basis points and 10-years by 59 basis points

Pivot Levels:

S&P 500 is above its 10-D EMA and its 20-D EMA is trending above 50-D EMA since March 9, 2016.

S&P 500 Cash eMini Futures
 Daily Level Break
Level Break
Pivot 2089.27 2079.33
R1 2108.53 49% 2102.17 47%
R2 2118.21 41% 2114.08 30%
R1 2137.47 42% 2136.92 27%
S1 2079.59 45% 2067.42 46%
S2 2060.33 49% 2044.58 39%
S3 2050.65 9% 2032.67 8%

Note: The probability of a level breaking is shown above is for the current condition when 20-D EMA is above 50-D EMA. R2 break probability comes in picture only when R1 is broken. So are the probabilities calculated for R3, S2 and S3

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