Morning Notes – Friday September 14, 2018

Directional Bias For The Day:

  • S&P Futures are higher; declining from all time high of 2917.25 at 3:30 AM
  • Breaking below above an descending triangle/double top on 6-minute chart
  • Odds are for a sideways to an up day; watch for break above 2917.25 and below 2909.50 for clarity
  • Key economic data due:
    • Retail Sales (0.3% vs. 0.5% ets.) at 8:30 AM
    • Core Retail Sales (0.1% vs. 0.4% est.) at 8:30 AM
    • Import Prices (-0.6% vs. -0.2% est.) at 8:30 AM
    • University of Michigan Consumer Sentiment (est. 96.7) at 10:00 AM

Markets Around The World

  • Markets in the East closed mostly higher – Shanghai was lower
  • European markets are mixed – U.K., Germany, France and STOXX 600 are up; Spain, Italy and Switzerland are down
  • Currencies:
    Up Down
    • Dollar index
    • EUR/USD
    • GBP/USD
    • AUD/USD
    • NZD/USD
    • USD/CAD
    • USD/INR
    • USD/JPY
    • USD/CHF
  • Commodities:
    Up Down
    • Crude Oil
    • Gold
    • Silver
    • Copper
    • Platinum
    • Palladium
    • Sugar
    • Cotton
    • NatGas
    • Coffee
    • Cocoa
  • Bonds
    • 10-yrs yield is at 2.992%, down from September 13 close of 2.972%;
    • 30-years is at 3.133%, up from 3.101%
    • 2-years yield is at 2.765%, up from 2.748%
    • The 10-Year-&-2-Year spread is at 0.180, down from 0.202

Key Levels:

  • Critical support levels for S&P 500 are 2900.07, 2896.39 and 2892.06
  • Critical resistance levels for S&P 500 are 2906.76, 2912.26 and 2916.50
  • Key levels for eMini futures: break above 2917.25, the high of 3:30 AM and break below 2909.50, the low of 9:30 PM

Pre-Open

  • On Thursday, at 4:00 PM, S&P future (December contract) closed at 2910.25 and the index closed at 2904.18 – a spread of about +6.00 points; futures closed at 2909.75 for the day; the fair value is +0.00
  • Pre-NYSE session open, futures price action is to the upside – at 8:45 AM, S&P 500 futures were up by +3.25; Dow by +28.00; and NASDAQ by +16.00

Directional Bias Before Open

  • Weekly: Uptrend
  • Daily: Uptrend
  • 120-Min: Up
  • 30-Min: Up
  • 15-Min: Up
  • 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 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 green real body that gapped up at the open and did not close it; no lower shadow and small upper shadow
  • %K above %D; above 90
  • Above 20-day EMA, above 50-day EMA, 100-day SMA and 200-day SMA
  • Uptrend
2-Hour (e-mini future)
  • Moving higher after bouncing off EMA50, along which the price moved from 8:00 AM on September 12 to 2:00 AM on September 13
  • RSI-9 above 40 since 8:00 AM on September 11; moved higher after reaching 44.64 at 12:00 AM on September 13; above 75
  • Above 20-bar EMA, which is above EMA10 of EMA50
  • Bias: Up
30-Minute (e-mini future)
  • Moving higher since 2:00 AM on September 13
  • RSI-9 mostly above 65 since 7:00 AM on September 13
  • Above 20-bar EMA, which is above 50-bar EMA
  • Bias: Up
15-Minute (e-mini future)
  • Bollinger Band (20, 2.0) is moving higher since 3:00 AM on September 13;
  • The band narrowed from 11:00 PM to 2:15; expanded till 7:15 AM and is again narrowing
  • RSI mostly above 40 and 65 since 10:45 AM on September 12; declining from a high of 76.33 at 3:30 AM; near 50
  • The Stochastic (9, 1, 3): %K crossed below %D at 7:15 AM from just above 70
  • Bias: Up

Previous Session

Major U.S. indices closed mixed on Thursday September 13 in lower volume. Russell 2000 and Dow Jones Transportation Average closed lower. S&P 500, Dow Jones Industrial Average, NASDAQ Composite, NYSE Composite and Wilshire 5000 Total Market Index closed higher. The advancing indices broke out from the previous close on open and closed higher. The day’s price range was small for all.

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

 

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