Morning Notes – Wednesday November 23, 2016

Directional Bias For The Day:

S&P 500 eMini Futures (2-hourly) 21-Nov-16 8:45 AM

  • The futures are lower after testing the last night’s high of 2203.00 at 4:00 AM
  • Breaking below an ascending triangle
  • Odds are for a down to sideway day within a narrow range

Markets Around The World

  • Markets in the East were mixed – Shanghai and Hong Kong were down; Sydney, Mumbai and Seoul were up; Tokyo was closed
  • European markets are down
  • Dollar index and USD/JPY are up; EUR/USD and GBP/USD are down
  • Commodities are down

Key Levels:

  • Critical support levels for S&P 500 are 2197.62, 2194.51 and 2186.43
  • Critical resistance levels for S&P 500 are 2204.80, 2206.99, and 2217.28
  • Key levels for eMini futures: break above 2203.50, high at 4:00 AM, and break below 2191.75, the low of 12:00 PM on November 22


  • Pre-NYSE session open, futures price action is to the downside – at 9:00 AM, S&P 500 futures were down by -3.75, Dow down by -6.00 and NASDAQ by -15.50
  • On Tuesday, at 4:00 PM, S&P future (Dec contract) closed at 2199.75 and the index closed at 2202.94 – a spread of about 3.25 points; futures closed at 2200.25 for the day

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

  • Up trend since Feb 08, 2016
  • Uptrend resumed; 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%)
  • Moved above 2193.81, which nullified the break below 2015 high made in early November
  • Above 39-week SMA and 89-week SMA
  • Above 100-day, 200-day, 50-day and 20-day SMA
  • Down trend line broken to the upside; trend line retaken on November 21
  • Sequence of higher highs and higher lows
  • Broken above the August high of 2193.81, the then all time
2-Hour (e-mini future)
  • Drifting sideways since 8:00 PM on November 22
  • Broken above a resistance zone – 2180-to-2185; which was also the upper limit of an ascending triangle; target near 2212
  • Broke a symmetrical triangle to the upside at 2:00 PM on November 15; reached the target near 2198 – 2200
  • At 20-bar EMA which is above 50-bar EMA
30-Minute (e-mini future)
  • Drifting down since 4:00 AM
  • Breaking below an ascending triangle
  • Below 20-bar and 5-bar EMA

Previous Session

S&P 500 22-Nov-16Major U.S. indices were positive on Tuesday. Like on Monday, all except Dow Transports and NYSE Composite made all time highs. All are continuing their break out of a short – 3-6 days – consolidation area.

Russell 2000 extended it up-streak to 13 days. Since 1987, it did that three times before Tuesday. Two of those times the streak was extended to 14 days. The longest such streak was of 21 days in March 1988. Since October 27, Dow Transportation Average has had only three losing days and 16 positive days.

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