Market Remarks

Morning Notes – Monday June 25, 2018

Directional Bias For The Day:

  • S&P Futures are lower; moving down since 2:00 PM on June 22;
  • Odds are for a down day in the early sessions – watch for break above 2747.50 and break below 2739.25 for more clarity
  • No key economic data due:

Markets Around The World

  • Markets in the East closed down
  • European markets are down
  • Currencies:
    Up Down
    • EUR/USD
    • GBP/USD
    • USD/CHF
    • USD/CAD
    • USD/INR
    • Dollar index
    • USD/JPY
    • AUD/USD
    • NZD/USD
  • Commodities:
    Up Down
    • Crude Oil
    • NatGas
    • Gold
    • Silver
    • Copper
    • Platinum
    • Palladium
    • Sugar
    • Coffee
    • Cotton
    • Cocoa
  • Bonds
    • 10-yrs yield is at 2.893%, down from June 21 close of 2.900%;
    • 30-years is at 3.040%, down from 3.045%
    • 2-years yield is at 2.541%, down from 2.549%
    • The 10-Year-&-2-Year spread is at 0.352, up from 0.351

Key Levels:

  • Critical support levels for S&P 500 are 2744.39, 2739.51 and 2728.74
  • Critical resistance levels for S&P 500 are 2761.46, 2774.16 and 2779.91
  • Key levels for eMini futures: break above 2747.50, the high of 8:00 AM and break below 2739.25, the low of 6:30 AM

Pre-Open

  • On Friday, at 4:00 PM, S&P future (September contract) closed at 2757.75 and the index closed at 2754.88 – a spread of about +3.25 points; futures closed at 2759.50 for the day; the fair value is -1.75
  • Pre-NYSE session open, futures price action is to the downside – at 9:00 AM, S&P 500 futures were down by -14.75; Dow by -173.00; and NASDAQ by -60.50

Directional Bias Before Open

  • Weekly: Uptrend Under Pressure
  • Daily: Uptrend
  • 120-Min: Down
  • 30-Min: Side-Down
  • 15-Min: Down-Side
  • 6-Min:Side

The trend and patterns on various time frames for S&P 500 are:

Monthly
  • Confirmed Uptrend
  • December 2017 closed higher; index has been higher for the nine straight months; it has only one down month, March 2017, since October 2016
  • Uptrend resumption since Feb 08, 2016 after a pull back of -15.2%
Weekly:
  • The week ending on June 22 was a red spinning top candle with almost equal sized upper and lower shadow
  • Last week’s pivot point=2757.69, R1=2772.18, R2=2789.49; S1=2740.38, S2=2725.89; S1/S2 pivot levels were breached;
  • A down week; first in last five weeks and fourth 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 near 2687.41 is achieved; the 100% extension target is near 2913.13
  • 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 near 2704.63 is achieved; the 261.8% extension target is near 3088.34
  • Last swing low, 2322.25, was the low on March 27, 2017; Last swing high, 2872.87, was during the week of January 22, 2-018; the low since the last swing high is 2532.69 during the week if February 5, 2018
  • Above 10-week EMA; above 39-week SMA and above 89-week SMA
  • Uptrend resumed
Daily
  • A large red candle with no upper shadow and small lower shadow; 3-day evening star is emerging
  • %K s below %D; made a small divergence on June 13 above 90
  • At/below 20-day EMA; above 50-day EMA and 100-day SMA; above 200-day SMA
  • Uptrend
2-Hour (e-mini future)
  • Declining since 10:00 AM on June 13 in steps; sequence of lower highs and lower lows broke at 8:00 PM on June 20;
  • Break above a down-sloping flag didn’t last; made a piercing candle at 6:00 AM; at the upper limit of the flag after a brief drop near the lower limit on June 21
  • RSI-9 fell from 55.52 to 26.84 by 12:00 AM on June 25; rising since then to 34; below 65 since 12:00 AM on June 222
  • %K crossed above %D at 6:00 AM on June 25 from below 10 after making a bullish divergence
  • Below 20-bar EMA, which is below EMA10 of EMA50
  • Bias: Down
30-Minute (e-mini future)
  • Near the lower limit of a symmetrical triangle; at a resistance zone
  • RSI-9 moving along 40 since 3:30 PM on June 22
  • At/above 20-bar EMA, which is below 50-bar EMA
  • Bias: Side-Down
15-Minute (e-mini future)
  • Bollinger Band (20, 2.0) is moving sideways since 1:15 AM
  • The band is narrow, relatively, since 1:15 AM; price moved along the lower band till 6:15 AM
  • RSI moving higher since 6:30 AM
  • The Stochastic (9, 1, 3): %K is crossed above %D at 6:45 AM from below 30; %K crisscrossing %D around 80
  • Bias: Down-Side

Previous Session

Major U.S. indices closed mixed on Friday June 22. Dow Jones Industrial Average, S&P 500, NYSE Composite and Wilshire 5000 Total Market Index closed higher. NASDAQ Composite, Russell 2000 and Dow Jones Transportation Average closed lower. The volume was mixed too as it declined for S&P 500 and NASDAQ Composite.

For the week, only Russell 2000 advanced, the volume was mixed and only Consumer Staples, Energy, Utility and Real Estate sectors advanced.

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

 

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