Directional Bias For The Day:
- S&P Futures are higher;
- The odds are for a sideways too an up day – watch for break below 2918.75 and break above 2929.75 for change of fortune
- Key economic data due:
- New Home Sales ( 645K est. ; prev. 646K) at 10:00 AM
- Fed Chair Powell Speech at 10:00 AM
- 9:00 AM Update:
- The sentiments have turned negative following China’s plans for retaliatory tariffs on U.S. goods;
- The low of Thursday, 2904.25, has been breached though futures have bounced up from that level but it has become the new critical support level;
- The support of 2899.60, the low of August 20, has become relevant for the index; next relevant level following that is 2882.60
- The bias for the day is now decidedly down
Markets Around The World
- Markets in the East closed mostly up – Seoul and Singapore were down
- European markets are higher
- Coffee (unch.)
- Cocoa (unch.)
- Crude Oil
- 10-yrs yield closed at 1.610%, up from August 21 close of 1.577%;
- 30-years is at 2.102%, up from 2.053%
- 2-years yield is at 1.622%, up from 1.578%
- The 10-Year-&-2-Year spread is at -0.012 up from -0.001
- Is at 15.81 up from August 21 close of 15.80 ; declining since August 15; below 5-day SMA 16.89
- Recent high was 24.81 on August 5; recent low was 11.69 on July 25
- Critical support levels for S&P 500 are 2921.91, 2914.41 and 2904.51
- Critical resistance levels for S&P 500 are 2932.35, 2939.08 and 2943.31
- Key levels for eMini futures: break above 2936.75, the high of 2:00 AM and break below 2927.00, the low of 6:30 AM
- On Thursday, at 4:00 PM, S&P future closed at 2923.25 and the index closed at 2922.95 – a spread of about +0.25 points; futures closed at 2922.25 for the day; the fair value is +1.00
- Pre-NYSE session open, futures are higher – at 7:30 AM, S&P 500 futures were up by +11.00; Dow by +94 and NASDAQ by +35.00
Directional Bias Before Open
- Weekly: Uptrend Under Pressure
- Daily: Uptrend Under Pressure
- 30-Min: Side
- 15-Min: Side
- 6-Min: Side
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 mostly closed down on Thursday, August 22 in mostly higher volume. Dow Jones Industrial Average closed higher and Russell 2000 traded in lower volume. The volume traded was lower than the 10-day average.
The stock market finished mixed on Thursday, as weak U.S. manufacturing data and reservations from a few Fed officials contributed to some indecisiveness. The S&P 500 (-0.1%), Nasdaq Composite (-0.4%), and Russell 2000 (-0.3%) declined modestly, while the Dow Jones Industrial Average (+0.2%) managed to finish higher.
Today’s events also had a noticeable effect on the U.S. Treasury market, where the 2-yr yield briefly rose above the 10-yr yield multiple times during the day. Both yields finished three basis points higher at 1.60% and 1.61%, respectively. WTI crude declined 0.7%, or $0.37, to $55.28/bbl.
• Initial jobless claims decreased by 12,000 to a very low 209,000 (Briefing.com consensus 218,000) for the week ending August 17. Continuing claims fell by 54,000 to 1.674 million for the week ending August 10.
o The key takeaway from the report was that it covered the period in which the survey for the August employment report was conducted. Accordingly, the very low level of initial claims should feed expectations for another solid increase in nonfarm payrolls.
• The Conference Board’s Leading Economic Index (LEI) increased 0.5% in July (Briefing.com consensus +0.2%) following an upwardly revised 0.1% decline (from -0.3%) in June. The key takeaway from the report is that it reflected a slower growth environment, evidenced by five of the ten components failing to make a positive contribution to the overall increase.