Morning Notes – Tuesday February 28, 2017

Directional Bias For The Day:

  • The futures are moving sideways lower since 4:30 PM on Monday
  • Very narrow trading range
  • Odds are for a sideways day; watch for break above 2370.75 or below 2361.00 for change of fortunes

Markets Around The World

  • Markets in the East were mixed – Shanghai, Tokyo and Seoul were up; Hong Kong, Sydney and Mumbai were down
  • European markets are mostly higher – only Germany is lower
  • Dollar index and GBP/USD are lower; USD/JPY and EUR/USD are higher
  • Commodities are mostly lower – only copper is higher
  • 10-yrs yield closed at 2.369% on February 27 up from February 24 close of 2.317%; 30-years closed at 2.986%, up from February 24 close of 2.955%

Key Levels:

  • Critical support levels for S&P 500 are 2367.22, 2361.87, and 2352.87
  • Critical resistance levels for S&P 500 are 2373.57, 2377.39 and 2383.24
  • Key levels for eMini futures: break above 2370.75, high of 3:30 PM on February 27 and break below 2361.00, the low of 9:30 PM on February 27


  • Pre-NYSE session open, futures price action is almost unchanged – at 7:00 AM, S&P 500 futures were down by -1.00, Dow up by -+1.00 and NASDAQ up by +0.25
  • On Monday, at 4:00 PM, S&P future (March contract) closed at 2368.75 and the index closed at 2369.75 – a spread of about 1.00 points; futures closed at 2368.25 for the day; the fair value is -0.50

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

  • Confirmed Uptrend
  • Uptrend resumption since Feb 08, 2016 after a pull back of -15.2%
  • Candlestick for the last week, Monday February 20, was a small green candle, that gapped up from previous week
  • Up for five consecutive weeks
  • Broke above a down-sloping flag on November 14, 2016; first target of 2285.92 is met; next target is near 2363.14
  • Last swing low, 2083.79, was the low on November 4, 2016
  • Above 39-week SMA and 89-week SMA
  • A green candle that opened in the body of previous day and closed higher; made another high
  • Intraday range less than 1.00% since December 29; since February 1 only three down days, all separate
  • Drifting higher within an up-sloping channel since December 27
  • Above 100-day, 200-day, 50-day, and 20-day SMA/EMA
  • Sequence of higher highs and higher lows
  • Last swing low 2263.62
2-Hour (e-mini future)
  • In a narrow since 6:00 PM on February 26
  • Up trend-channel line forming with three highs of February 21, 23 and 26
  • Early morning pattern similar to that of last few days with minor differences
  • Confirmed up-trend
  • Above a rising 20-bar EMA and 50-bar EMA
30-Minute (e-mini future)
  • Broadening top formation – four touches to upper limit and two touches to lower limit; a break below 2349.50 will confirm the topping pattern
  • A double top of 2370.00 formed by the high of 11:00 PM on February 26 and 3:00 AM; target of the break below was achieved
  • Above rising 20-bar EMA and flattening 50-bar EMA

Previous Session

U.S. indices mostly higher after the first half-hour of decline on Monday February 27. S&P 500 is rising after the gap down open on Friday February 24.

S&P 500 and Dow Jones Industrial Average made another highs other major indices did not.

Print Friendly, PDF & Email