Morning Notes – Monday March 13, 2017

Directional Bias For The Day:

  • The futures are higher;
  • Range bound since 3:00 PM on Friday March 10
  • Retracing from 2370.00, the NYSE session close on Friday
  • Odds are for a sideways day with an upward bias; watch for break above 2370.00 and break below 2364.75 for change of fortunes

Markets Around The World

  • Markets in the East closed mostly higher – Shanghai was down
  • European markets are mostly higher – Germany is lower
  • Dollar index, EUR/USD and GBP/USD are up; USD/JPY is lower
  • Commodities are mostly up – crude oil is down;  NatGas, copper, gold and silver are higher
  • 10-yrs yield is at 2.578% down from March 10 close of 2.582%; 30-years is at 3.170% up from 3.169%

Key Levels:

  • Critical support levels for S&P 500 are 2363.04, 2354.54 and 2352.87
  • Critical resistance levels for S&P 500 are 2376.86, 2383.89 and 2388.59
  • Key levels for eMini futures: break above 2370.00 high of 4:00 PM on March 10 and break below 2365.25, the low of 7:00 AM


  • Pre-NYSE session open, futures price action is to the upside – at 9:00 AM, S&P 500 futures were up by +1.50, Dow by +19.00 and NASDAQ is unchanged
  • On Friday, at 4:00 PM, S&P future (June contract) closed at 2370.00 and the index closed at 2372.60 – a spread of about +2.50 points; futures closed at 2368.50 for the day; the fair value is +1.50

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, Friday March 10, was a  red doji candle – small body, small upper shadow and slightly larger lower shadow
  • Did not breach the high of previous week
  • Broke a streak of six consecutive positive 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 small green doji candle with small upper and lower shadow that is breaking above a short down sloping flag
  • Intraday range less than 1.00% since December 29;
  • Breaking out from an up-sloping channel that is n effect 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)
  • Continuing the break above of a down trend line that started on March 1 but hasn’t broken the sequence of lower lows and lower highs; a break above 2376.25 will do it
  • General drift lower since making a high of 2301.00 at 2:00 PM on March 1
  • Confirmed uptrend
  • At flattening 20-bar EMA and 50-bar EMA
30-Minute (e-mini future)
  • Breaking above a symmetrical triangle after rising from the lows of 2359.00 reached at 1:00 PM on March 10; target near 2376.00 (a resistance) and 2379.00;
  • March 10 high was slightly above the 38.2% Fibonacci retracement level of the decline from 2401.00 on March 1 to the low of 2354.00 on March 9; the 61.8% retracement level is near 2382.25
  • Pre-NYSE open price action is range bound since 6:30 PM on March 1e
  • Above flat 20-bar EMA and 50-bar EMA

Previous Session

U.S. indices closed mixed on Friday March 10. S&P 500  and Dow Jones Industrial Average closed higher for the second time – their fifth up day in last ten days. NASDAQ Composite  was up for third day, its sixth in last ten days. Russell 2000 and Dow Jones Transportation Average broke their losing streak. Russell 2000 broke its six day losing streak and DJT four days.

For the week. the major indices were down. S&P 500 and NASDAQ Composite broke their six-week winning streak and DJIA broke its four-week winning streak. Russell 2000 declined for the third straight week.

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