Morning Notes – Monday June 28, 2021

Directional Bias For The Day:

  • S&P Futures are higher;
  • The odds are for a sideways to an up day – watch for a break below 4277.50 or a break above 4268.50 for clarity
  • No key economic data report due during the day:

Directional Bias Before Open:

  • Weekly: Uptrend
  • Daily: Uptrend Resumed
  • 120-Min: Up
  • 30-Min: Up-Side
  • 15-Min: Up-Side
  • 6-Min: Side-Down

Key Levels:

  • Critical support levels for S&P 500 are 4275.51, 4271.16, and 4264.41
  • Critical resistance levels for S&P 500 are 4286.12, 4294.29, and 4302.45
  • Key levels for E-mini futures: break above 4277.50, the high of 3:15 AM and break below 4268.50, the low of 6:30 AM


  • On Friday at 4:00 PM, S&P futures (September 2021) closed at 4270.75 and the index closed at 4280.70 – a spread of about -10.00 points; futures closed at 4271.25 for the day; the fair value is -0.50
  • Pre-NYSE session open, futures are mixed – at 8:30 AM, S&P 500 futures were up by +4.25; Dow down by -26, and NASDAQ up by +44.75

Markets Around The World

  • Markets in the East closed mostly lower – Singapore closed higher
  • European markets are mostly lower – Germany and Switzerland are up
  • Currencies (from two weeks ago):
    Up Down
    • Dollar index
    • USD/JPY
    • USD/CHF
    • USD/CAD
    • INR/USD
    • EUR/USD
    • GBP/USD
    • AUD/USD
    • NZD/USD
  • Commodities (from two weeks ago):
    • Energy futures are higher
    • Precious metals are lower
    • Industrial metals are lower
    • Most soft commodities are mixed
  • Treasuries (from two weeks ago)
    • 10-years yield closed at 1.512%, up +5.0 basis points from two weeks ago;
    • 30-years is at 2.140%, down -1.2 basis points;
    • 2-years yield is at 0.278%, up +12.9 basis points;
    • The 10-Year-&-2-Year spread is at 1.234, down from 1.313
  • VIX
    • At 15.94 @ 8:00 AM; down from the last close; at/below 5-day SMA;
    • Recent high =  21.82 on June 21; low =  14.19 on June 24
    • Sentiment: Risk-On

The trend and patterns on various time frames for S&P 500:

  • Confirmed Uptrend
  • May 2021 was a Doji with a small upper shadow and a long lower shadow; at all-time closing and intra-month highs;
    • Stochastic %K above %D near 100;
    • RSI-9 near 80; broke above a downtrend line from January 2018
    • Above the upper band of a 120-month regression channel;
  • The sequence of higher highs and higher lows
  • The week ending on June 25 was a Bullish Engulfing candle at all-time highs with almost no lower and  upper shadows
    • Stochastic (9,1, 3): %K crossed above %D;
    • RSI (9) is just below 70
  • The week was up +114.25 or +2.7%; the 5-week ATR is 76.49
  • An up week; fourth in the last five weeks, and sixth in the last ten weeks
  • The weekly week pivot point=4246.74, R1=4320.08, R2=4359.46; S1=4207.36, S2=4134.02; R1 pivot level was breached
  • Above 10-week EMA, 39-week SMA, and 89-week SMA
  • Uptrend since March 23, 2020
  • A relatively small spinning top candle that gapped up and did not fill the gap
    • %K is above %D; above 90
    • RSI-9 just above 65; above 8-day EMA
  • Above 20-day EMA, 50-day EMA, 100-day, and 200-day SMA
  • Uptrend Resumed
2-Hour (E-mini futures)
  • Moving up since 10:00 PM on June 20;
    • RSI-21 declined to just above 65 from near 80 at 6:00 PM on Sunday
    • Above EMA20; which is above EMA10 of EMA50
  • Bias: Up
30-Minute (E-mini futures)
  • Moving sideways to down 4:30 PM on Friday
    • RSI-21 is declining since 6:00 PM on Sunday from near 70; moving around 55
    • Above EMA20, which is above EMA10 of EMA50
  • Bias: Up-Side
15-Minute (E-mini futures)
  • The Bollinger Band (20, 2.0) is moving sideways to down since 7:30 PM on June 25
  • The Bollinger Band is expanding slightly since 3:00 AM; price first walked down the lower band and then bounced up to the upper band
    • Stochastic (9, 1, 3): %K is crisscrossing %D higher
  • Bias: Up-Side

Previous Session

Major U.S. indices closed mixed on Friday, June 25 in mostly higher volume. NASDAQ Composite and Dow Jones Transportation Average closed lower. NASDAQ Composite traded in lower volume. S&P 500 and Wilshire 5000 Total Market Index made all-time intraday and closing highs. All but one S&P sector – Technology – closed higher.

For the week, major indices closed higher in lower volume. Asian market closed mostly higher and European exchanges were up. The dollar index was down for the week. Energy, precious metals, industrial metals were up for the week but soft commodities were mixed. The US treasury yields ticked up. All but one S&P sector – Utilities – closed up for the week.


The S&P 500 (+0.3%) set new intraday and closing record highs on Friday, largely due to strength in the financial stocks. PCE inflation data for May remained on the hotter side, which contributed to a bump in long-term interest rates.

The Dow Jones Industrial Average outperformed with a 0.7% gain, while the Nasdaq Composite (-0.1%) closed lower as the higher rates clipped its growth-stock components. The Russell 2000 (+0.03%) erased its intraday gain in the last ten minutes of action, as trading volume surged at the close amid the annual FTSE Russell index rebalance.

Specifying the data, the PCE Price Index for May rose 0.4% m/m and the core-PCE Price Index, which excludes food and energy, rose 0.5% m/m ( consensus 0.6%). On a year-over-year basis, the Fed’s preferred measures of inflation were up 3.9% and 3.4%, respectively. The 10-yr yield increased five basis points to 1.54% after an initial muted reaction.


The 2-yr yield was unchanged at 0.27%. The U.S. Dollar Index was little changed at 91.78. WTI crude futures rose 1.0%, or $0.75, to $74.06/bbl.

  • Personal income decreased 2.0% month-over-month in May ( consensus -2.5%), driven by an 11.8% decline in government social benefits, while personal spending was unchanged ( consensus +0.3%) following an upwardly revised 0.9% increase (from +0.5%) in April. The PCE Price Index jumped 0.4% month-over-month and was up 3.9% year-over-year (versus 3.6% in April). The core-PCE Price Index, which excludes food and energy, rose 0.5% and was up 3.4% year-over-year (versus 3.1% in April).
  • […]
  • The final June reading for the University of Michigan Index of Consumer Sentiment slipped to 85.5 ( consensus 86.4) from the preliminary reading of 86.4. The final reading for May was 82.9.
  • Russell 2000 +18.2% YTD
  • S&P 500 +14.0% YTD
  • Dow Jones Industrial Average +12.5% YTD
  • Nasdaq Composite +11.4% YTD
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