Directional Bias For The Day:

• Futures are sharply lower
• Moving down since 9:30 AM on May 16
• 20-bar EMA is acting as a resistance level
• Futures rose to 2367 during Asian session but are not down to 2350.00
• Odds are for a down day; watch for break above 2360.75 for change of fortunes
• Key economic data:
  • Unemployment Claims – 232K vs. 240K est. – at 8:30 AM
  • Philly Fed Manufacturing Index – 38.8 vs. 19.9 – at 8:30 AM

Markets Around The World

• Markets in the East were lower
• European markets are lower
• Dollar index, EUR/USD and USD/JPY are down; GBP/USD is up
• Commodities are mixed – crude oil, silver and copper are down; NatGas and gold are up
• 10-yrs yield closed at 2.216% on May 17 down from May 16 close of 2.329%; 30-years closed at 2.897% down from 2.992%

Key Levels:

• Critical support levels for S&P 500 are 2353.02, 2344.51 and 2340.91
• Critical resistance levels for S&P 500 are 2366.71, 2369.19 and 2376.98
• Key levels for eMini futures: break above 2354.50, the high of 8:00 AM and break below 2344.50, the low of 5:30 AM

Pre-Open

• Pre-NYSE session open, futures price action is to the down side – at 8:15 AM, S&P 500 futures were down by -10.50; Dow by -104.00; and NASDAQ by -16.25
• On Wednesday, at 4:00 PM, S&P future (June contract) closed at 2356.00 and the index closed at 2357.03 – a spread of about 1.00 points; futures closed at 2357.50 for the day; the fair value is -1.50

Directional Bias Before Open

• Weekly: Up
• Daily: Side
• 120-Min: Down
• 30-Min: Down

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

Monthly	Confirmed Uptrend Uptrend resumption since Feb 08, 2016 after a pull back of -15.2%
Weekly:	Candlestick for the last week, Friday May 12, was a red bearish engulfing candle, with small upper and lower shadows; pivot point 2392.17; R1=2302.60, R2=2414.30; S1=2380.47, S2=2370.04 A down week – second in last five weeks; fifth in last ten weeks Broke above a down sloping flag (2378.36), which has bullish implications; 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
Daily	Gapped down at the open and closed near the low of the day Forming a double top – March 1 high of 2400.98 and May 16 high of 2405.77; the intermediate low is 2322.25; a break below it will have a target near 2240.00 level Falling back within the down sloping flag that it broke above on April 24; break below 2328.95 will nullify the pattern Move above an up-sloping channel since December 27 still relevant Below 20-day and 50-day EMA; above 100-day and 200-day Last swing low 2263.62 Uptrend under pressure
2-Hour (e-mini future)	Downtrend since 8:00 AM on May 16 – lower highs, lower lows Filled the gap up open of April 23 Uptrend since 10:00 AM on May 11 is broken Below falling 20-bar EMA, which is below 50-bar EMA
30-Minute (e-mini future)	Down trend since 9:30 AM on May 16 – lower lows and lower highs; EMA-20 is acting as resistance level Below falling 20-bar EMA, which is below 50-bar EMA

Previous Session

Major U.S. indices closed down sharply on Wednesday May 17. All gapped down at the open and then closed near the lows of the day.