Directional Bias For The Day:
- The futures are moving up after deep losses
- Up more than 12 points from 4:30 AM low of 2116.00
- Odds are for a bounce which may not last for long – watch for break of critical levels for direction
Markets Around The World
- Markets in the East were mixed – Shanghai, Hong Kong, Seoul and Sydney were down; Mumbai and Tokyo were up
- European markets are mostly down – France is the sole exception
- European markets are sharply up from the session open lows
- Dollar index, GBP/USD are down; EUR/USD and USD/JPY are up
- Commodities are mixed – Crude oil, gold and silver are down; NatGas and copper are up
- Critical support levels for S&P 500 are 2130.09, 2124.57, and 2114.74
- Critical resistance levels for S&P 500 are 2140.53, 2147.13, and 2154.79
- Key levels for eMini futures: break above 2129.50, the 8:00 PM high on October 27, for bulls and break below 2116.25, the low of 4:30 AM, for bears
- Pre-NYSE session open, futures price action is to the upside; at 7:00 AM, S&P 500 futures were up[ by +4.50, Dow by +33.00 and NASDAQ by +9.00
- On Thursday, at 4:00 PM, S&P future (Dec contract) closed at 2127.75 and the index closed at 2133.04 – a spread of about 5.25 points; futures closed at 2123.50 for the day
The trend and patterns on various time frames for S&P 500 are:
|2-Hour (e-mini future)||
|30-Minute (e-mini future)||
Thursday started with U.S futures rising but the mood of the market changed at 9:00 AM when S&P 500 futures were at 2143.75. After that it was mostly downhill. A brief rally at 10:00 AM fizzled at the 20-bar EMA on 30-minute chart.
For the day, S&P 500 and NASDAQ Composite made a bearish engulfing candlestick pattern. S&P 500 did not breach previous day’s low but NASDAQ did. Dow Jones Industrial Average turned down from 50-day EMA.
Russell 2000 followed through on its break of an uptrend line on Wednesday. In the process, it also broke below a support level, the low that it reached on September 13 and October 13. Along with the high reached on September 7 and September 22, this forms a break of a horizontal channel – high of 1263.43 and low of 1206.07. The downside target is near 1148 level. The corresponding target for IWM, iShares Russell 2000 ETF, is 114.35, which is 3.4% below current level of 118.36.