Morning Notes – Friday November 10, 2017

Directional Bias For The Day:

  • S&P Futures are down
  • Drifting higher since 4:30 AM
  • Uptrend line since 4:40 AM with 2 touches; also an emerging up sloping flag
  • Odds are for increased volatility; higher chances for a down day; chances for an up day are significant – watch for break above 2580.25 and below 2572.75  for change of fortunes
  • Key economic data:
    • Prelim UoM Consumer Sentiment (est. 100.8) at 10:00 AM

Markets Around The World

  • Markets in the East closed mostly lower – Shanghai and Mumbai were up
  • European markets are mostly lower – Germany and Italy are up
  • Currencies:
    Up Down
    • Dollar index
    • EUR/USD
    • GBP/USD
    • USD/CHF
    • USD/CAD
    • USD/JPY
    • AUD/USD
    • NZD/USD
  • Commodities:
    Up Down
    • Crude Oil
    • Silver
    • Coffee
    • Cotton (unch.)
    • NatGas
    • Gold
    • Copper (unch.)
    • Platinum
    • Palladium
    • Sugar
    • Cocoa
  • 10-yrs yield is at 2.375% up from November 9 close of 2.331%; 30-years is at 2.858% up from 2.806%

Key Levels:

  • Critical support levels for S&P 500 are 2576.46, 2566.33 and 2559.94
  • Critical resistance levels for S&P 500 are 2586.48, 2592.33 and 2597.02
  • Key levels for eMini futures: break above 2580.25, the low of 6:30 PM on November 8 and break below 2572.75, the low of 7:00 AM

Pre-Open

  • On Thursday, at 4:00 PM, S&P future (December contract) closed at 2582.00 and the index closed at 2584.62 – a spread of about 2.75 points; futures closed at 2584.00 for the day; the fair value is -2.00
  • Pre-NYSE session open, futures price action is to the down side – at 8:45 AM, S&P 500 futures were down by -6.50; Dow by -20.00; and NASDAQ by -14.25

Directional Bias Before Open

  • Weekly: Up
  • Daily: Up
  • 120-Min: Up-Side
  • 30-Min: Side-to-Down
  • 15-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:
  • 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 dragonfly pattern; RSI-14 divergence – on October 20 the RSI was 79.65 and the 2578,29, on November 8 the high was 2595.47 and the RSI was 72.5
  • 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=2579.15; R1=2591.97, R2=2599.32; S1=2571.80, S2=2558.98; S1/S2/S3 were breached
  • Confirmed Uptrend
2-Hour (e-mini future)
  • Drifting down since the high of 2594.50 at 8:00 PM on Wednesday; a double top forming; broke below prior low and the bounce found resistance at 20-bar EMA and 50-bar EMA; drifting down since midnight
  • Broken below an uptrend line since the low of 2541.50 at 12:00 PM on October 25;
  • Sequence of higher highs and higher lows since 10:00 AM on November 2 and since August 29 with few exceptions; another break below occurred
  • Below 50-bar EMA, which is below 20-bar EMA
30-Minute (e-mini future)
  • Declining since 12:00 midnight following 61.8% Fibonacci retracement of the sharp decline on November 9
  • Thursday
  • 8:30 PM on November 8; got rejected at 20-bar EMA at 2:30 AM;
  • Broken below the lower limit of a horizontal channel / double top – high 2593.50 and low 2579.75; 100% extension is near 2566.00 is achieved, it was also near an intermediate support zone; the 161.8% extension is near 257.50, which is the next target and near a support zone around 2550.50
  • Below a falling 20-bar EMA, which is below a falling 50-bar EMA
15-Minute (e-mini future)
  • Downtrend since 9:00 PM n November 8
  • Bouncing off after a breach of the lower bounds of the envelop (20 – 17%) and Bollinger Band (20 – 2 std dev); near 20-bar EMA, which is acting as a resistance since midnight
  • Below a falling 20-bar EMA, which is below a falling 50-bar EMA

Previous Session

Major U.S. indices closed lower on Thursday November 9. The day’s range was large and at the lows the indices were down 0.9% to 1.5%. The bounce started id-day and recovered a major part of decline. At the end of the day, most indices made either a dragonfly doji or a hammer pattern. Dow Jones Transportation Average continued its fall. Break over either extremes – high or low – will be critical in giving clues for net few day’s market direction.

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

 

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