Morning Notes – Thursday October 13, 2016

Directional Bias For The Day:

S&P 500 eMini Future 13-Oct-16 8:30 AM

  • The futures are sharply down following disappointing Chinese trade data last night
  • Odds are for a down day
  • Key levels for eMini futures: break above 2121.75, October 11 lows at 2:00 PM, for bulls and break below 2113.50, 3:30 AM low, for bears
  • Markets in the East were down, except for Shanghai
  • European markets are mostly down
  • On Wednesday, at 4:00 PM, S&P future (Dec contract) closed at 2133.50 and the index closed at 2139.18 – a spread of about 5.75 points; futures closed at 2131.50 for the day

Key Levels:

  • Critical support levels for S&P 500 are 2128.84, 2120.26 and 2109.66
  • Critical resistance levels for S&P 500 are 2145.36, 2151.69 and 2161.56
  • Pre-NYSE session open, futures price action is to the downside; at 8:45 AM, S&P 500 futures were down by -14.75, Dow by -123.00 and NASDAQ is down by -34.00

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

  • Up trend since Feb 08, 2016
  • Current uptrend under pressure; need to rise above 2187.87 to relieve the pressure
  • 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; need to rise above 2179.99 to relive the pressure
  • Up-sloping flag that morphed into a symmetrical triangle broke to the downside on Tuesday
  • Break below 2119.12 will break the down trend line and form first lower low before making a higher high
2-Hour (e-mini future)
  • An ascending triangle broke to the downside
  • Downtrend since 10:00 AM on September 22 – mostly lower lows and lower highs
30-Minute (e-mini future)
  • Down trend since 9:30 Am on October 10
  • Lower high / lower low
  • The broken support of 2:00 PM low of 2121.75  on October 11 is acting as a resistance.; a break above it will have the next resistance at 2131.00 level

Before NYSE Session Open

S&P 500 12-Oct-16On Wednesday, major U.S. indices declined at the open then rose and then again declined in the final few hours of trading. The result was that most made near doji candlestick formations.

Dow Jones Transportation Average, was the worst performer. Dow Jones Industrial Average and S&P 500 gained slightly, NASDAQ lost and Russell 200 was almost unchanged.


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