Morning Notes – Tuesday November 7, 2017

/ November 7, 2017

Directional Bias For The Day:

  • S&P Futures are little changed to down
  • Drifting mostly down since 1:30 AM after rising to all time high of 2593.50
  • Potential H&S pattern being formed on 30-minute time-frame
  • Odds are for a sideways to down day – watch for break above 2590.50 and below 2586.75  for change of fortunes
  • No key economic data due:

Markets Around The World

  • Markets in the East closed mostly higher – Mumbai and Seoul closed down
  • European markets are lower – Italy up
  • Currencies:
    Up Down
    • Dollar index
    • USD/JPY
    • USD/CHF
    • USD/CAD
    • EUR/USD
    • GBP/USD
    • AUD/USD
    • NZD/USD
  • Commodities are mostly down
    Up Down
    • Palladium
    • Cocoa
    • Crude Oil
    • NatGas
    • Gold
    • Silver
    • Copper
    • Platinum
    • Sugar
    • Cotton
    • Coffee
  • 10-yrs yield is at 2.327% up from November 6 close of 2.320%; 30-years is at 2.802% up from 2.797%

Key Levels:

  • Critical support levels for S&P 500 are 2585.66, 2581.98 and 2574.29
  • Critical resistance levels for S&P 500 are 2594.45, 2597.78 and 2602.17
  • Key levels for eMini futures: break above 2590.50, the high of 4:30 AM and break below 2586.75, the low of 7:30 AM

Pre-Open

  • On Monday, at 4:00 PM, S&P future (December contract) closed at 2588.00 and the index closed at 2591.13 – a spread of about 2.75 points; futures closed at 2588.75 for the day; the fair value is -0.75
  • Pre-NYSE session open, futures price action is little changed to down – at 8:30 AM, S&P 500 futures were down by -0.50; Dow up by +13.00; and NASDAQ down by -1.50

Directional Bias Before Open

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

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 small spinning top candle with very small upper and lower shadow
  • 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=2590.06; R1=2594.45, R2=2597.78; S1=2586.73, S2=2582.34; R1 was breached
  • Confirmed Uptrend
2-Hour (e-mini future)
  • Drifting down after making a new high of 2593.50 at mid-night; at the prior resistance turned support near 2585.50
  • Above an uptrend line since the low of 2541.50 at 12:00 PM on October 25; two touches
  • Sequence of higher highs and higher lows since 10:00 AM on November 2 and since August 29 with few exceptions
  • Above rising 20-bar EMA, which is above rising 50-bar EMA
30-Minute (e-mini future)
  • Broke above an imperfect horizontal channel with  lows near 2575.50 and highs near 2585.50 on November 6; achieved 79.8% extension of the channel
  • Drifting down since 1:30 AM
  • At the uptrend line from the lows of 2562.25 at 10:00 AM on November 2
  • Potential H-&-S pattern forming with neck near 2586.75; partial right shoulder is being formed
  • Below recently drooping 20-bar EMA, which is above flattening 50-bar EMA

Previous Session

Major U.S. indices mostly closed higher on Monday November 6. Dow Jones Transportation Average closed down. Similar to their action on Frida, most indices generally drifted higher for most of the day. The day’s range was small and many indices gave a large portion of day’s gain during the final half hour of trading.

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

 

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