Directional Bias For The Day:
- S&P Futures are down; moving down in steps; fresh leg down since 7:00 AM;
- The odds are for a down day with elevated volatility – watch for break above 2834.50 for change of fortune
- China trade and tariff news is still impacting the sentiments
- Key economic data due:
- Retail Sales (-0.2% vs. 0.2% est.; prev. 1.7%) at 8:30 AM
- Core Retail Sales (0.1% vs. 0.7% est.; prev. 1.3%) at 8:30 AM
- Empire State Manufacturing Index (17.8 vs. 8.2 est.; prev. 10.1) at 8:30 AM
- Capacity Utilization ( 77.9% vs. 78.7% est.; prev. 78.5%) at 9:15 AM
- Industrial Production (-0.5% vs. 0.0% est.; prev. 0.2%) at 9:15 AM
Markets Around The World
- Markets in the East closed mostly up – Mumbai and Singapore were down
- European markets are mostly lower – U.K is up
- Dollar index
- Crude Oil
- 10-yrs yield closed at 2.377%, down from May 14 close of 2.419%;
- 30-years is at 2.821%, down from 2.852%
- 2-years yield is at 2.147%, down from 2.200%
- The 10-Year-&-2-Year spread is at 0.230, up from 0.219
- Critical support levels for S&P 500 are 2820.12, 2804.09 and 2801,43
- Critical resistance levels for S&P 500 are 2833.63, 2845.73 and 2852.54
- Key levels for eMini futures: break above 2834.50, the high of 7:00 AM and break below 2816.25, the low of 4:30 AM on May 14
- On Tuesday, at 4:00 PM, S&P future (June contract) closed at 2835.75 and the index closed at 2834.41 – a spread of about +1.25 points; futures closed at 2839.25 for the day; the fair value is -3.50
- Pre-NYSE session open, futures are lower – at 9:00 AM, S&P 500 futures were down by -17.50; Dow by -160 and NASDAQ by -47.75
Directional Bias Before Open
- Weekly: Uptrend
- Daily: Uptrend under pressure
- 120-Min: Down
- 30-Min: Down
- 15-Min: Down
- 6-Min: Down
The trend and patterns on various time frames for S&P 500:
|2-Hour (e-mini future)||
|30-Minute (e-mini future)||
|15-Minute (e-mini future)||
Major U.S. indices closed higher on Tuesday, May 14 in lower volume. Indices gapped up at the open and then for most of the day rose higher before giving back some of the gains in the last hour of trading. Most indices made green harami candlestick pattern with almost no lower shadow and long upper shadow within a large red candle.
The S&P 500 advanced as much as 1.5% on Tuesday on positive U.S.-China trade rhetoric. The broad-based rebound effort, however, lost steam into the close, leaving the S&P 500 up 0.8% for the session.
The Dow Jones Industrial Average gained 0.8%, the Nasdaq Composite gained 1.1%, and the Russell 2000 gained 1.3%.
The U.S. Treasury market was more reserved on Tuesday, registering modest declines amid the rebound in equities. The 2-yr yield increased two basis points to 2.20%, and the 10-yr yield increased one basis point to 2.42%. The U.S. Dollar Index increased 0.2% to 97.53. WTI crude rose 1.2% to $61.84/bbl, bolstered by increased concerns about supply disruption in the Middle East.
• Import prices increased 0.2% month-over-month and declined 0.1% excluding fuel. Export prices rose 0.2% and were up 0.4% excluding agricultural exports. On a yr/yr basis, overall import prices declined 0.2%. Excluding fuel, they were down 0.9%. Export prices were up just 0.3%, versus 3.7% for the 12-months ending in April 2018, and up only 0.7% excluding agricultural products, versus 3.9% for the 12 months ending in April 2018.
o The key takeaway is that import prices declined, creating another data point that shows a lack of worrisome inflation pressure.
• The NFIB Small Business Optimism Index for April increased to 103.5 from 101.8 in March.