Directional Bias For The Day:
- S&P Futures are lower;
- The odds are for a down day with elevated volatility
- Futures are sharply down at the open and there is great chance of a bounce from pre-open low levels
- Key economic data due:
- New Home Sales ( est. 730K; prev. 719K) at 10:00 AM
Directional Bias Before Open:
- Critical support levels for S&P 500 are 3238.35, 3232.43 and 3214.64
- Critical resistance levels for S&P 500 are 3251.95, 3260.86 and 3277.19
- Key levels for eMini futures: break above 3253.00, the high of 7:00 AM and break below 3235.75, the low of 6:00 AM
- On Friday, at 4:00 PM, S&P future (March 2020) closed at 3294.50 and the index closed at 3295.47 – a spread of about -1.00 points; futures closed at 3293.50 for the day; the fair value is +1.00
- Pre-NYSE session open, futures are lower – at 9:15 AM, S&P 500 futures were down by -56.50; Dow by -470 and NASDAQ by -185.00
Markets Around The World
- Markets in the East were mostly closed, the ones open – Tokyo and Mumbai – ended down for the day
- European markets are lower
- Dollar index
- Crude Oil
- 10-yrs yield closed at 1.622%, down from January 23 close of 1.740%;
- 30-years is at 2.078%, down from 2.182%
- 2-years yield is at 1.489%, down from 1.518%
- The 10-Year-&-2-Year spread is at 0.192down from 0.222
- Is at 18.62 up +4.06 from January 24; above 5-day SMA
- Next high resistance is 21.46, the high of October 2, 2019; the low support is the low was 11.72 on December 26
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 sharply lower on Friday, January 24 in mostly higher volume. Dow Jones Transportation Average traded in lower volume. All but one S&P sectors – Utilities – closed down. Major indices mostly made bearish engulfing candle pattern.
For the week, major U.S> indices closed down in mostly lower volume. DJT was the only index to trade in higher volume. All but three S&P sectors – Technology, Utilities and Real Estate – closed down. Most Asian and European indices also closed down for the week. Only Sydney, DAX and Swiss market were up over the week.
The S&P 500 lost 0.9% on Friday in a steady decline from opening levels, as risk sentiment was dampened by the CDC confirming the second case of coronavirus in the U.S. The Nasdaq Composite lost 0.9%, the Dow Jones Industrial Average lost 0.6%, and the Russell 2000 lost 1.4%.
The day started in positive territory, with the Nasdaq even setting a new intraday high, after Intel (INTC 68.47, +5.15, +8.1%) and American Express (AXP 135.11, +3.74, +2.9%) impressed investors with earnings and guidance. The early lead dissipated amid a view that the coronavirus could impinge discretionary spending and earnings growth.
The 2-yr yield declined four basis points to 1.48%, and the 10-yr yield declined six basis points to 1.68%. The U.S. Dollar Index increased 0.2% to 97.86. WTI crude dropped 2.5% (-$1.40) to $54.21/bbl, as expectations for oil demand continued to weaken amid the spread of the coronavirus.