Morning Notes – Tuesday December 26, 2017

/ December 26, 2017

Directional Bias For The Day:

  • S&P Futures are down to little changed; mostly moving sideways since 6:30 PM on December 21
  • In the middle of a horizontal channel on 30-Minute chart
  • Odds are for a sideways move with down bias from current levels – watch for break above 2689.50 and break below 2683.50 for change of fortunes
  • No Key economic data due:

Markets Around The World

  • Markets in the East closed mixed – Shanghai and Mumbai were up; Tokyo and Seoul were down; Hong Kong and Sydney were closed
  • European markets are closed
  • Currencies:
    Up Down
    • EUR/USD
    • USD/JPY
    • USD/CHF
    • AUD/USD
    • NZD/USD
    • Dollar index
    • GBP/USD
    • USD/CAD
  • Commodities:
    Up Down
    • Crude Oil
    • NatGas
    • Gold
    • Silver
    • Copper
    • Palladium
    • Sugar
    • Coffee
    • Cocoa
    • Platinum
    • Cotton
  • Bonds
    • 10-yrs yield is at 2.479% up from December 22 close of 2.485%;
    • 30-years is at 2.825% up from 2.832%
    • 2-years yield is at 1.908% up from 1.882%
    • The 10-Year-&-2-Year spread is at 0.571 down from 0.603

Key Levels:

  • Critical support levels for S&P 500 are 2676.11, 2672.20 and 2668.45
  • Critical resistance levels for S&P 500 are 2684.43, 2692.64 and 2694.44
  • Key levels for eMini futures: break above 2689.50, the high of 3:30 PM on December 22 and break below 2683.75, the low of 8:30 PM on December 25

Pre-Open

  • On Friday, at 4:00 PM, S&P future (March contract) closed at 2688.75 and the index closed at 2683.34 – a spread of about +4.25 points; futures closed at 2686.00 for the day; the fair value is +2.75
  • Pre-NYSE session open, futures price action is to the downside – at 8:00 AM, S&P 500 futures were down by -1.75; Dow down by -42.00; and NASDAQ down by -35.00

Directional Bias Before Open

  • Weekly: Up
  • Daily: Up
  • 120-Min: Side
  • 30-Min: Side
  • 15-Min: 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:
  • The week ending on December 15 was a large green candle following a near doji for previous week
  • Last week’s pivot point 2668.97; R1=2686.47, R2=2697.13; S1=2658.31, S2=2640.81; R1 was breached
  • An up week;  fourth in last five weeks and eight in last ten weeks
  • Broke above a down sloping flag on April 24 2017;
    • flag-low was 2322.25 during 27-Mar-17 week; shorter flag-pole length is 317.19 and longer flag-pole length is 590.88;
    • 100% extension target of shorter flag-pole near 2639.41 is achieved; and the 161.8% extension target is near 2835.46
    • 61.8% extension target of longer flag-pole is near 2687.41
  • Broke above a down-sloping flag on November 14, 2016;
    • the flag low was 2083.79 during 31-Oct-16 week; the shorter flag-pole length is 202.13 and the longer flag-pole length is 383.71;
    • 261.8% extension target of shorter flag-pole near 2612.97 is achieved
    • the 161.8% extension target of longer flag-pole is near 2704.63
  • 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 near doji candle with small upper shadow and larger lower shadow
  • 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 72.50; on November 30, RSI-14 was 76.67 and the index was at 2657.74; on December 12 the index was 2669.72 and RSI was 74.77; on December 18, the index was at 2694.97 and the RSI was at 75.91 and RSI fell on December 19
  • Last pattern, a down-sloping flag in June that was broken to the upside on July 13, 2017; in August the index declined and tested the broken upper limit of the flag
  • Above 20-day EMA but above 50-day EMA; Above 100-day SMA and 200-day SMA
  • Pivot Point=2682.27; R1=2686.42, R2=2689.49; S1=2679.20; S2=2675.05; S1 was breached
  • Confirmed Uptrend
2-Hour (e-mini future)
  • Futures moving sideways since 4:00 on December 21; in the middle of a horizontal channel – high of 2687.50 and the low of 2679.00
  • Sequence of higher highs and higher lows since 10:00 AM on November 2 and since August 29 with few exceptions is reasserted on November 21; it is again under pressure
  • At flattening 20-bar EMA, which is at flattening 50-bar EMA
30-Minute (e-mini future)
  • Moving sideways since 8:30 PM on December 25 near the middle of a horizontal channel – high of 2691.50 and low of 2680.75
  • RSI-14 has fallen below 50, again, at 6:00 AM is staying below 65 since 2:30 PM on December 21; has crossed above 65 only three times since 2:30 PM on December 18
  • At/below flat 50-bar EMA, which is below flat 20-bar EMA
15-Minute (e-mini future)
  • Bollinger Band (20, 2.0) has been moving sideways since 11:00 PM on December 21 with a down bias
  • The band contracted at midnight, with bandwidth below 0.10, and remained so till 6:15 AM
  • MFI-14 is declining from 1:00 AM high of 84.34; dipped below 20 at 7:00 and now coming off it
  • The Stochastic (9, 1, 3) is toggling around 20 since 4:45 AM

Previous Session

Major U.S. indices closed lower on Friday December 22. The day’s action was small and most indices made doji like patterns. Russell 2000 made a larger red real body bearish harami patter. Dow Jones Transportation Average made a larger green bullish harami candle.

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

 

Print Friendly, PDF & Email

Related posts