Morning Notes – Monday September 19, 2016

Directional Bias For The Day:

  • S&P 500 eMini Futures - 2-Hour - 19-Sept-16 6:00 AMThe futures are up since 2:00 PM on Friday
  • On Monday after September expiry Friday, S&P 500 has been down 13 out of last 16 years
  • Key: break above 2144.50 for bulls and break below 2132.00 for bears
  • Markets in the East were mostly up with only Australia being down; China, Japan, Hong Kong, South Korea and India were up
  • European markets are up after gapping-up at the open
  • On Friday, at 4:00 PM, S&P future (Dec contract) closed at 2130.50 and the index closed at 2139.16 – a spread of about 8.75 points

Key Levels:

  • Critical support levels for S&P 500 are 2131.20, 2119.92 and 2116.13
  • Critical resistance levels for S&P 500 are 2146.48, 2151.31 and 2157.57
  • Pre-NYSE session open, futures price action is to the up side; at 8:30 AM, S&P 500 futures was up by +10.00, Dow was up by +88.00 and NASDAQ was up by +18.00

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

  • Up trend since Feb 08, 2016
  • Current uptrend under pressure
  • Fallen below an up-trending 10-week SMA
  • Up trend since Feb 08, 2016 with one pullback; broke out of a 2-year trading range in July, 2016
  • Last swing low, 1991.68, was reached on June 27, 2016
  • Uptrend remains under pressure
  • Friday was a red-harami candlestick day within a larger green candle
  • Despite a down day, prices rose in the last half hour of trading
  • 38.2% retracement from last low is 2116.59 and is  not breached
2-Hour (e-mini future)
  • Breaking above a symmetrical triangle
  • A break above 2144.50 will also break the sequence of lower highs / lower lows since September 12
30-Minute (e-mini future)
  • Facing resistance at 2144.50, the high reached on September 15

Before NYSE Session Open

Friday was down day for major U.S. indices but for the week they were up. Apple, Inc was a stellar performer during the week and it cushioned the market decline. by AAPL.

Dow Jones Industrial Average and S&P 500 are still below the rectangle trading range that they broke below on September 9. NASDAQ Composite has climbed back to the middle of the range.

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