Morning Notes – Friday November 18, 2016

Directional Bias For The Day:

S&P 500 eMini Futures (2-hourly) 18-Nov-16 6:30 AM

  • The futures are down but drifting up since 4:00 AM
  • Making a horizontal trading range between 2185 and 2176
  • Odds are for a range bound day with a downside bias

Markets Around The World

  • Markets in the East were mixed – Shanghai, Seoul and Mumbai were down; Hong Kong, Tokyo and Sydney were up
  • European markets are down
  • Dollar index is up; EUR/USD, USD/JPY and GBP/USD are down
  • Commodities are mixed – crude oil, and NatGas are up; gold, silver and copper are down

Key Levels:

  • Critical support levels for S&P 500 are 2183.20, 2179.03 and 2172.30
  • Critical resistance levels for S&P 500 are 2188.06, 2193.42, and 2202.65
  • Key levels for eMini futures: break above 2184.25, high at 3:00 AM, and break below 2176.50, the low of 4:00 AM


  • Pre-NYSE session open, futures price action is mixed – at 7:00 AM, S&P 500 futures were down by -1.25, Dow down by -6.00 and NASDAQ is up by +0.75
  • On Thrusday, at 4:00 PM, S&P future (Dec contract) closed at 2184.25 and the index closed at 2187.12 – a spread of about 3.00 points; futures closed at 2184.25 for the day

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

  • Up trend since Feb 08, 2016
  • Uptrend resumed
  • Above an 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 the low on June 27, 2016
  • Broke below a small bearish ABCD pattern with a downside target near 2105.30 (100% – met), 2076.77 (138.2%), 2067.96 (150%), 2059.14 (161.8%)
  • Broken below 2015 high, which was acting as a resistance
  • Crossed above 39-week SMA after falling below it; above 89-week SMA
  • Above 100-day, 200-day, 50-day and 20-day SMA
  • Down trend line broken to the upside; trying to retake the line
  • Sequence of lower highs and lower lows broken but reverse sequence hasn’t started
  • Trying to rise above a resistance, at 2179.99, the high of September 22
2-Hour (e-mini future)
  • At a resistance zone – 2180-to-2185 – level
  • Emerging Ascending triangle
  • Sideways since 10:00 AM on November 17
  • Broken the emerging descending triangle to the upside; which is turning into a rectangle trading box
  • At 20-bar EMA from above
30-Minute (e-mini future)
  • Drifting lower since 12:00 PM on November 17
  • At a resistance level; emerging ascending triangle
  • Above an up trend line since 12:30 PM on November 14

Previous Session

S&P 500 17-Nov-16Major U.S. indices advanced on Thursday. In early morning trading, futures were holding steady within a narrow range. Market changed tone at 9:00 AM and started to move up and closed at the high.

Russell 2000 extended its winning streak to ten days. Since its inception in 1987, it had 21 such occurrences prior to current one. Eleven of them were up on eleventh day too. Since 2010, it had only one such instance, which did not go beyond ten days.

S&P 500 and NASDAQ Composite are nearing all time highs made in August and September respectively. Dow Jones Industrial Average made another all time high on November 14 and Wilshire 5000 Total Market Index and Russell 2000 made on November 17. Dow Transportation Average and NYSE Composite are off their all time highs, which they made in 2014 and 2015 respectively.

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