Directional Bias For The Day:
- S&P Futures are lower; moving lower since 8:00 AM after rising from 3:30 PM on October 29
- Odds are for a down and choppy day with elevated volatility
- Key economic data due:
- S&P/Case-Shiller Composite-20 HPI (5.5% vs. 6.0% est.) at 9:00 AM
- CB Consumer Confidence (est. 136.3) at 10:00 AM
Markets Around The World
- Markets in the East closed mixed – Shanghai, Tokyo, Sydney and Seoul closed up; Hong Kong, Mumbai and Singapore closed down
- European markets are mostly down – Italy and Switzerland are down
- Dollar index
- Crude Oil
- 10-yrs yield is at 3.113%, up from October 29 close of 3.087%;
- 30-years is at 3.359%, up from 3.329%
- 2-years yield is at 2.839%, up from 2.823%
- The 10-Year-&-2-Year spread is at 0.274, up from 0.264
- Critical support levels for S&P 500 are 2603.54, 2594.62 and 2586.27
- Critical resistance levels for S&P 500 are 2642.20, 2662.54 and 2682.69
- Key levels for eMini futures: break above 2660.75, the high of 8:00 AM and break below 2636.25, the low of 6:30 PM on October 29
- On Monday, at 4:00 PM, S&P future (December contract) closed at 2643.00 and the index closed at 2641.25 – a spread of about -1.75 points; futures closed at 2643.50 for the day; the fair value is -0.50
- Pre-NYSE session open, futures price action is to the downside – at 9:15 AM, S&P 500 futures were down -4.75; Dow by -63; and NASDAQ by -55.25
Directional Bias Before Open
- Weekly: Uptrend Under Pressure
- Daily: In Correct
- 120-Min: Down
- 30-Min: Down-Side
- 15-Min: Down-Side
- 6-Min: Down-Side
The trend and patterns on various time frames for S&P 500 are:
|2-Hour (e-mini future)||
|30-Minute (e-mini future)||
|15-Minute (e-mini future)||
The indices gapped higher at the open but then turned down after one hour of trading and closed the gap. They declined for the rest of the and most indices made bearish engulfing patterns. All S&P Sectors were down.
The S&P 500 lost 0.7% in another volatile session on Monday, extending its monthly losses to 9.4%. Continued tech weakness shook investor confidence, and reports of another possible round of Chinese tariffs helped accelerate losses in the afternoon.
Stocks opened strong, with the S&P 500 trading as high as 1.8% early on, before gradually losing steam in the afternoon. Particular weakness in leadership stocks within the information technology (-1.8%), communication services (-1.6%), and consumer discretionary (-1.5%) sectors weighed heavily on the broader market.
Meanwhile, the Dow Jones Industrial Average lost 1.0%, the Nasdaq Composite lost 1.6%, and the Russell 2000 lost 0.4%.
The major averages were already at session lows, with the S&P 500 hovering near its unchanged mark, before the U.S.-China news broke out. Bloomberg reported that the White House is preparing to announce tariffs on all remaining Chinese imports if talks next month between U.S. president Donald Trump and Chinese president Xi Jinping fail to ease the trade war.
[…] In other markets, Treasury yields closed slightly higher with the 2-yr yield and 10-yr yield adding one basis point each to 2.82% and 3.09%, respectively. Also, the U.S. Dollar Index increased 0.3% to 96.63, and WTI crude fell 1.1% to $66.85/bbl.
[…] The key takeaway from the [PCE Price Index] report is the recognition that PCE price inflation decelerated to 2.0% year-over-year from 2.2% in August. Core PCE price inflation held steady at 2.0%. The inflation readings are on par with the Federal Reserve’s longer run target, yet they haven’t moved to such a degree that they are going to alter the Federal Reserve’s current policy stance, which involves an expectation for further gradual rate hikes.
- S&P 500 Sectors
|Sector||Daily Trend (Visual)||Relative Strength (Last Month)||Relative Strength (Current)|
|Consumer Staples||Under Pressure||SPY||XLP|
|Heath Care||Under Pressure||XLV||XLV|
|Real Estate||Down (Turning Up)||SPY||XLRE|