Morning Notes – Tuesday September 11, 2018

Directional Bias For The Day:

  • S&P Futures are lower; moving lower since 3:00 AM; moving sideways since 5:30 AM
  • Odds are for a down day; watch for break above 2876.00 for change of fortune
  • No key economic data due:

Markets Around The World

  • Markets in the East closed mostly lower – Tokyo and Sydney were up
  • European markets are lower
  • Currencies:
    Up Down
    • Dollar index
    • USD/JPY
    • USD/CAD
    • USD/INR
    • EUR/USD
    • GBP/USD
    • USD/CHF
    • 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 2.950%, up from September 10 close of 2.937%;
    • 30-years is at 3.092%, up from 3.088%
    • 2-years yield is at 2.727%, up from 2.710%
    • The 10-Year-&-2-Year spread is at 0.223, down from 0.227

Key Levels:

  • Critical support levels for S&P 500 are 2875.94, 2864.12 and 2854.60
  • Critical resistance levels for S&P 500 are 2882.20, 2886.93 and 2898.22
  • Key levels for eMini futures: break above 2876.00, the high of 6:00 AM and break below 2870.00, the low of 8:00 AM

Pre-Open

  • On Monday, at 4:00 PM, S&P future (September contract) closed at 2878.75 and the index closed at 2877.13 – a spread of about +1.75 points; futures closed at 2879.00 for the day; the fair value is +1.00
  • Pre-NYSE session open, futures price action is to the down side – at 8:30 AM, S&P 500 futures were down by -8.00; Dow by -114.00; and NASDAQ by -36.50

Directional Bias Before Open

  • Weekly: Uptrend
  • Daily: Uptrend
  • 120-Min: Down-Side
  • 30-Min: Side
  • 15-Min: Side-Down
  • 6-Min: Down-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 September 7 was a red candle with almost no upper shadow and small lower shadow; in danger of making  a 3-bar evening star pattern
  • Last week’s pivot point=2878.86, R1=2893.20 R2=2914.72; S1=2857.14, S2=2842.60; S1/S2 pivot levels were breached;
  • A down week in a row; third in last five weeks and second in last ten weeks
  • Broke above an ascending triangle but retraced back to its upper limit; 100% extension target is near 3070.00 level
  • 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 2639.44 and the 161.8% extension target near 2835.46 are achieved; the 261.8% extension target is near 3013.72
    • 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
Daily
  • A small red real body candle with small upper shadow and smaller lower shadow;
  •  %K is below %D, but trying to cross over from below 20
  • At 20-day EMA, above 50-day EMA, 100-day SMA and 200-day SMA
  • Uptrend
2-Hour (e-mini future)
  • The move from a low of 2865.00 on September 7 met a resistance at EMA50 and turned down and I approaching the previous low; below a down trendline from the high of August 29 but broken above a steeper down trendline from the high on September 4
  • RSI-9 below 40 from near 65
  • Below 20-bar EMA, which is below at EMA10 of EMA50
  • Bias: Down-Side
30-Minute (e-mini future)
  • Declining since 11:30 PM; nearing the lows of September 7
  • RSI-9 below 40 since 4:00 AM; potential bullish divergence just above 30
  • Below 20-bar EMA, which is below 50-bar EMA
  • Bias: Side
15-Minute (e-mini future)
  • Bollinger Band (20, 2.0) is moving down since 3:15 AM after a sideways move from 4:45 AM on September 19
  • The band expanding since 3:15 AM with price moving along the lower band
  • RSI below 40 since 3:15 AM; rising since 5:00 AM and making bullish divergence
  • The Stochastic (9, 1, 3): %K crisscrossing %D and moving up since 4:30 AM from 0; bullish divergences
  • Bias: Side-Down

Previous Session

Major U.S. indices closed mostly higher on Monday September 10 in lower volume. Dow Jones Industrial Average closed lower. The price action for most indices was mostly down after the early trading.

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

 

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