Morning Notes – Monday November 6, 2017

/ November 6, 2017

Directional Bias For The Day:

  • S&P Futures are little changed to up
  • Drifting mostly higher since 10:00 PM on Sunday
  • Odds are for a sideways to down day – watch for break above 2585.50 and below 2575.50  for change of fortunes
  • No key economic data due:

Markets Around The World

  • Markets in the East closed mixed – Shanghai, Tokyo and Mumbai closed up; Hong Kong, Sydney and Seoul closed down
  • European markets are lower – STOXX 600 is up
  • Currencies:
    Up Down
    • Dollar index
    • GBP/USD
    • AUD/USD
    • USD/CAD
    • EUR/USD
    • USD/JPY
    • USD/CHF
    • NZD/USD
  • Commodities are mostly down
    Up Down
    • Crude Oil
    • NatGas
    • Gold
    • Copper
    • Silver
    • Palladium
    • Coffee
    • Platinum
    • Sugar
    • Cotton
    • Cocoa
  • 10-yrs yield is at 2.324% down from November 3 close of 2.343%; 30-years is at 2.800% down from 2.822%

Key Levels:

  • Critical support levels for S&P 500 are 2581.98, 2574.29 and 2566.17
  • Critical resistance levels for S&P 500 are 2591.92, 2595.99 and 2603.57
  • Key levels for eMini futures: break above 2585.50, the high of 2:00 PM on November 3 and break below 2580.00, the low of 6:00 AM

Pre-Open

  • On Friday, at 4:00 PM, S&P future (December contract) closed at 2585.00 and the index closed at 2587.84 – a spread of about 2.75 points; futures closed at 2582.75 for the day; the fair value is +2.25
  • Pre-NYSE session open, futures price action is little changed to up – at 9:00 AM, S&P 500 futures were up by +0.75; Dow up by +27.00; and NASDAQ up by +2.25

Directional Bias Before Open

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

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:
  • A shaved top doji candle with lower shadow almost equal to real body
  • Last week’s pivot point 2580.81; R1=2595.45, R2=2603.06; S1=2573.20, S2=2558.56; No levels were breached weeks
  • An up week – eighth in last five weeks; ninth 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
Daily
  • A shaved top candled with a lower shadow slightly smaller than the real body
  • 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=2584.34; R1=2591.92, R2=2595.99; S1=2580.27, S2=2572.69; R1 was breached
  • Confirmed Uptrend
2-Hour (e-mini future)
  • Declined at the start of the week from the high of 2585.50 to the low of 2575.50; bouncing off the prior resistance turned support, which was the upper limit of a horizontal channel that was been broken to the upside thrice with two pull-back ins
  • Above an uptrend line since the low of 2541.50 at 12:00 PM on October 25; two touches
  • Sequence of lower highs and lower lows since 6:00 PM October 22 has broken; a new reverse sequence is being established
  • Above 20-bar EMA, which is above 50-bar EMA
30-Minute (e-mini future)
  • Moving up since the low of 2575.50 at 10:00 PM on November 5, which is also the lower limit of a horizontal channel with a high of 2585.50, which was touched twice; nearing the upper limit
  • On Sunday, broke below  an uptrend line from the low of November 2; the bounce from the low is hugging the broken trend line for few bars
  • Above 20-bar EMA, which is above 50-bar EMA

Previous Session

Major U.S. indices mostly closed higher on Friday November 3. Dow Jones Transportation Average and Russell 2000 closed down. Most indices generally drifted higher for most of the day. They are also making a three-day reversal pattern. A break above Friday’s high will be critical.

The week was mixed for indices. Russell 2000, DJT and NYSE Composite closed down for the week. S&P 500, Dow Jones Industrial Average and NASDAQ Composite made at all time weekly highs.

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

 

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