Morning Notes – Wednesday September 20, 2017

Directional Bias For The Day:

  • S&P Futures are little changed
  • Drifting mostly sideways up since 8:00 PM on September 17;
  • An ascending triangle emerging on 30-minute chart – high of 2506.00 and low of 2497.75; break above will have a target near 2514.25
  • Markets are in wait-&-see mode due to FOMC meeting
  • Odds are for sideways day – watch for break above 2506.00 and break below 2502.25 for a change of fortunes
  • Key economic data due:
    • Existing Home Sales (est. 5.46M) at 10:00 AM
    • FOMC Statement and Economic Projections at 2:00 PM
    • FOMC Press Conference at 2:30 PM

Markets Around The World

  • Markets in the East closed mixed – Shanghai, Hong Kong and Tokyo were up; Sydney, Mumbai and Seoul were down; the intra-day trend mirrored the end of day direction
  • European markets are mostly lower – France and Switzerland are up; intra-day trend is down
  • Currencies:
    Up Down
    • EUR/USD
    • GBP/USD
    • AUD/USD
    • NZD/USD
    • Dollar index
    • USD/JPY
    • USD/CHF
    • USD/CAD
  • Commodities are mostly down
    Up Down
    • Crude Oil
    • NatGas
    • Gold
    • Silver
    • Copper
    • Platinum
    • Palladium
    • Sugar
    • Coffee
  • 10-yrs yield closed at 2.243% on September 19 up from September 18 close of 2.229%; 30-years closed at 2.813% up from 2.803%

Key Levels:

  • Critical support levels for S&P 500 are 2499.92, 2493.16 and 2490.37
  • Critical resistance levels for S&P 500 are 2508.60, 2510.54 and 2513.25
  • Key levels for eMini futures: break above 2506.00, the high of 3:30 PM on September 19 and break below 2502.25, the low of 8:30 PM on September 19


  • On Tuesday, at 4:00 PM, S&P future (December contract) closed at 2505.00 and the index closed at 2506.65 – a spread of about 1.25 points; futures closed at 2504.75 for the day; the fair value is +0.25
  • Pre-NYSE session open, futures price action is little changed to down – at 8:30 AM, S&P 500 futures were unchanged; Dow down by -5.00; and NASDAQ down by -1.50

Directional Bias Before Open

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

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%
  • A green shaven top and shaven bottom candle that gapped up from previous day’s red harami candle; all time highs after a brief – seven week pullback
  • Last week’s pivot point 2491.66; R1=2508.80, R2=2517.37; S1=2483.09, S2=2465.95; R1/R2/R3 were breached; support levels not breached for four weeks
  • An up week – third in last five weeks; sixth in last ten weeks
  • Broke above a down sloping flag (2378.36) on April 24, which has bullish implications; first target is near 2520.00 and the second target is near 2640.00
  • Broke above a down-sloping flag on November 14, 2016; first target of 2285.92 is achieved; second target is near 2467.50
  • Last swing low, 2322.25, was the low on March 27, 2017
  • Above 10-week EM; above 39-week SMA and 89-week SMA
  • Confirmed uptrend, though pulling back and moving sideways since June 5
  • A small doji candle that mostly stayed within the upper shadow of Tuesday
  • Last pattern, a down-sloping flag in June that was broken to the upside on July 13, is re-asserted
  • Above 20-day EMA, which is above 50-day EMA; Above 100-day SMA and 200-day SMA
  • Pivot Point=2505.89; R1=2508.60, R2=2510.54; S1=2503.95, S2=2501.24; None of the support or resistance levels were breached
  • Confirmed Uptrend
2-Hour (e-mini future)
  • Not much change from Tuesday’s pre-session price action; moving sideways since 8:00 PM on September 17 in a very narrow range
  • Sequence of higher high and higher low since 12:00 PM September 5
  • Above flat 20-bar EMA, which is above rising 50-bar EMA
30-Minute (e-mini future)
  • Same as on Tuesday morning; drifting sideways since 8:00 PM on September 17
  • An ascending triangle emerging since 9:30 AM on September 18 – high of 2506.00 and low of 2497.75; break above will have a target near 2514.25
  • High highs and higher lows, with couple of exceptions, since 5:00 AM on August 29
  • Above a flat 20-bar EMA, which is above flat 50-bar EMA

Previous Session

Major U.S. indices closed mixed Tuesday September 19. Russell 2000 and Dow Jones Transportation Average closed lower. The day’s range was small. Dow Jones Industrial Average made all time highs. S&P 500 and NASDAQ closed at all time highs. Most of the day’s action was in the first hour.

  • S&P 500 Sectors
Up Down
  1. Consumer Staples
  2. Consumer Discretionary
  3. Utility
  4. Heath Care
  5. Real Estate
  1. Energy
  2. Materials
  3. Industrials
  4. Finance
  5. Technology


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