Morning Notes – Friday April 28, 2017

Directional Bias For The Day:

  • Futures are almost unchanged
  • Within a narrow horizontal channel since12:30 PM on April 27
  • Channel upper limit 2388.75, lower limit 2383.00 – upper target 2394.50, lower target 2377.25
  • Odds are for a range bound day; watch for break above 2388.75 and break below 2383.00 for change of fortunes
  • Key economic data:
    • Advanced Q1 GDP – 0.7% vs. 1.3% est. – at 8:30 AM
    • Advanced GPD price Index – 2.3% vs. 2.0% est. – at 8:30 AM
    • Chicago PMI at 9:45 AM
    • Revised University of Michigan Consumer Confidence and Inflation Expectation at 10:00 AM

Markets Around The World

  • Markets in the East closed mostly lower – Shanghai and Sydney were higher; Tokyo, Mumbai, Hong Kong and Seoul closed lower
  • European markets are mostly higher – Germany, France, Spain and Italy are up; U.K. Switzerland and STOXX 600 are lower
  • Dollar index is lower; GBP/USD, USD/JPY and EUR/USD are higher
  • Commodities are mostly up – crude oil, gold, silver and copper are up; NatGas is down
  • 10-yrs yield closed at 2.296% on April 27 down from April 26 close of 2.311%; 30-years closed at 2.965% down from 2.971%

Key Levels:

  • Critical support levels for S&P 500 are 2382.68, 2376.17 and 2369.19
  • Critical resistance levels for S&P 500 are 2392.10, 2398.16 and 2400.98
  • Key levels for eMini futures: break above 2388.75, the high of 1:00 PM on April 27, and break below 2383.00, the low of 3:30 PM on April 27


  • Pre-NYSE session open, futures price action is almost unchanged – at 8:15 AM, S&P 500 futures were up by +0.50, Dow up by +12.00 and NASDAQ down by  -2.00
  • On Thursday, at 4:00 PM, S&P future (June contract) closed at 2385.25 and the index closed at 2388.77 – a spread of about 3.50 points; futures closed at 2386.00 for the day; the fair value is -0.75

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 April 21, was a  small green candle, a harami with open and close within the body of previous large red candle
  • An up week – second in in last five weeks; sixth in last ten weeks
  • Forming a small down-sloping flag; break above 2378.36 will be bullish
  • Broke above a down-sloping flag on November 14, 2016; first target of 2285.92 and second target of 2363.14 are achieved
  • Last swing low, 2083.79, was the low on November 4, 2016
  • Above 39-week SMA and 89-week SMA
  • Confirmed uptrend, though pulling back
  • A near doji following a near gravestone doji; index lost its early session gains and some more in the second half of the trading day; break below 2382.68 will be short term bearish; break above 2392.10 will be bullish
  • Broke above a down sloping flag on April 24; broke above 2378.36, which is bullish; found resistance at flag-pole high of 2400.98; the target will be near 2650
  • Uptrend under pressure; break above April 5 high of 2378.36 is critical for uptrend
  • Move above an up-sloping channel since December 27 still relevant
  • Above 100-day, 200-day, 50-day SMA/EMA and 20-day EMA
  • Last swing low 2263.62
  • Uptrend under pressure
2-Hour (e-mini future)
  • Within a narrow range since 10:00 AM on April 25 – high 2389.25 and low 2382.25; a break above this high was brief and the price has come back within the range
  • The horizontal channel break target, near 2385.00, was achieved
  • Uptrend since 8:00 PM on April 16; higher highs and higher lows
  • Within a range since March 21 – high 2378.75 and the low of 2327.25
  • Above rising 50-bar EMA; at flat 20-bar EMA
30-Minute (e-mini future)
  • Within a narrow range since 4:P0 AM on April 26 – high 2386.50 and low 2381.25
  • A narrow horizontal channel since 1:00 PM on April 27 – high 2388.75 and low 2383.00
  • Achieved the target of the broken ascending triangle at 6:00 PM on Sunday April 23; triangle height is 33.75 points and the break out point is 2356.50, giving a 100% extension target near 2390.00
  • Above rising 50-bar EMA; at 20-bar EMA

Previous Session

Major U.S. indices closed mixed on Thursday April 27. Russell 2000 and NYSE Composite index were down. S&P 500, Dow Jones Industrial Average, NASDAQ Composite and Dow Jones Transportation Average were higher. NASDAQ made another all time high and Russell 2000 made a red harami within a green candle.

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