Morning Notes – Monday November 21, 2016

Directional Bias For The Day:

S&P 500 eMini Futures (2-hourly) 21-Nov-2016 8:15 AM

  • The futures are up after making a low of 2179.25 at 4:40 AM
  • Breaking above a resistance level and a horizontal trading range between 2185 and 2176
  • Odds are for an upside day

Markets Around The World

  • Markets in the East were mixed – Sydney, Seoul and Mumbai were down; Shanghai, Hong Kong, and Tokyo were up
  • European markets are mixed -Germany, U.K. and France are up; Spain, Italy and Switzerland are down
  • Dollar index is down; EUR/USD, USD/JPY and GBP/USD are up
  • Commodities are up

Key Levels:

  • Critical support levels for S&P 500 are 2180.38, 2174.77 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 2187.50, high at 9:30 AM on November 18, and break below 2183.75, the low of 7:00 AM


  • Pre-NYSE session open, futures price action is to the upside – at 8:30 AM, S&P 500 futures were up by +5.75, Dow down by +20.00 and NASDAQ is up by +13.25
  • On Friday, at 4:00 PM, S&P future (Dec contract) closed at 2179.75 and the index closed at 2181.90 – a spread of about 3.00 points; futures closed at 2180.75 for the day

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

  • Up trend since Feb 08, 2016
  • Uptrend resumed; broken above a downtrend line since August 15 high
  • 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% – came close), 2067.96 (150%), 2059.14 (161.8%)
  • Broken below 2015 high, which was acting as a resistance; move above 2193.81 will nullify this break
  • 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
  • Broke a symmetrical triangle to the upside at 2:00 PM on November 15; the target is near 2198 – 2200
  • At 20-bar EMA from above; bouncing off it
30-Minute (e-mini future)
  • Drifting higher since 11:00 AM on November 18
  • At a resistance level; emerging ascending triangle
  • Hugging an up trend line, which started at 12:30 PM on November 14

Previous Session

S&P 500 18-Nov-16Major U.S. indices were mixed on Friday. Only Russell 2000 and Dow Transportation Average were up and rest were down.

Russell 2000 extended it up-streak to 11 days. Since 1987, it did that 11 times before Friday. Seven times the streak was extended to 12 days.

Dow Jones Industrial Average has been making a consolidation pattern for the last six day. Dow Transports has had a shorter consolidation period – three days. It is also breaking above the recent high of 8844.53 made on November 15.

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