Morning Notes – Tuesday October 1, 2019

Directional Bias For The Day:

  • S&P Futures are higher;
  • The odds are for a sideways to up day – watch for break above 2994.50 and break below 2982.75 for clarity
  • Key economic data due:
    • ISM Manufacturing PMI ( 50.4 est.; prev. 49.1 ) at 10:00 AM
    • Construction Spending (0.5% est.; prev. 0.1%) at 10:00 AM
    • ISM Manufacturing Prices ( 50.5 est. ; prev. 46.0 ) at 10:00 AM

Markets Around The World

    • Markets in the East closed mostly higher – Mumbai was down; Shanghai and Hong Kong were closed
    • European markets are mostly lower – U.K. and Italy are up
    • Currencies:
Up Down
  • Dollar index
  • USD/JPY
  • USD/CHF
  • USD/CAD
  • INR/USD
    • EUR/USD
    • GBP/USD
    • AUD/USD
    • NZD/USD
  • Commodities:
    Up Down
    • Crude Oil
    • Silver
    • Sugar
    • Cotton
    • Cocoa
    • NatGas
    • Gold
    • Copper
    • Platinum
    • Palladium
    • Coffee
  • Bonds
    • 10-yrs yield is at 1.730%, up from September 30 close of 1.675%;
    • 30-years is at 2.178%, up from 2.121%
    • 2-years yield is at 1.646%, up from 1.616%
    • The 10-Year-&-2-Year spread is at 0.066 up from 0.059
  • VIX
    • Is at 16.08 down from September 30 close of 16.24; below 5-day SMA 16.314
    • Recent high was 18.69 on September 27; recent low was 13.31 on September 19

Key Levels:

  • Critical support levels for S&P 500 are 2983.85, 2974.97 and 2962.86
  • Critical resistance levels for S&P 500 are 2989.82, 3007.98 and 3016.37
  • Key levels for eMini futures: break above 2994.50, the high of 3:00 AM and break below 2982.75, the low of 7:00 AM

Pre-Open

  • On Monday, at 4:00 PM, S&P future closed at 2977.75 and the index closed at 2976.74 – a spread of about +1.00 points; futures closed at 2978.50 for the day; the fair value is -0.75
  • Pre-NYSE session open, futures are higher – at 9:00 AM, S&P 500 futures ere up by +10.25; Dow by +85 and NASDAQ by +30.75

Directional Bias Before Open

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

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

Monthly
  • Under Pressure
  • September was a green candle with small lower shadow and longer upper shadow
    • Stochastic %K is forming a Bearish Divergence
    • RSI-9 is below a downtrend line from January 2018 high; forming a Bearish Divergence
    • Near the middle band of the 120-month regression channel
  • Sequence of higher highs and higher lows since February 2016 is broken in December since then a new high has been made in May 2019
Weekly:
  • The week ending on September 27 was a red spinning top with almost equal sized upper and lower shadows; bias is down since the week of September 9
    • Near the upper bound of a broadening pattern
    • Stochastic (9,1, 3): %K is below %D;
    • RSI (9) is turning down and just above 50
  • Last week was down -30.28 or -1.0%; the 5-week ATR is 71.39
  • Last week’s pivot point=2971.77, R1=2998.00, R2=3034.22; S1=2935.55, S2=2909.32; S1/S2 pivot levels were breached
  • A down week; second in last five weeks and sixth in last ten weeks
  • Last swing low, 2728.81, was the low on June 3, 2018; previous all-time high of 2940.91 was breached during July 1 week; last swing high 3027.98 during the week of July 22
  • Above 10-week EMA; above 39-week SMA and 89-week SMA
  • Uptrend Under Pressure
Daily
  • A small green harami candle in a congestion zone
    • %K crossing above %D from near 30
    • RSI-9 turning up near 50
  • At/below 20-day EMA; above 50-day EMA, 100-day SMA, 20-DAY EMA; above 200-day SMA;
  • Uptrend Under Pressure
2-Hour (e-mini future)
  • Moving mostly sideways since 10:00 AM on September 5 – between 3025.00 and 2950.00
    • RSI-21 is rising since 12:00 PM on September 27
    • %K is below %D since midnight
  • At/above 20-bar EMA, which is above EMA10 of EMA50
  • Bias: Side-Down
30-Minute (e-mini future)
  • Drifting up since 2:30 PM on September 27
    • RSI-21 above 40 since 3:30 PM on September 27
    • %K is above %D near 70
    • At/above 20-bar EMA, which is above EMA10 of EMA50
  • Bias: Side-Up
15-Minute (e-mini future)
  • Bollinger Band (20, 2.0) is moving sideways to up since 12:45 PM on Monday
  • The Bollinger Band was relatively narrow from 1:00 AM to 3:30 AM; expanding slightly since
  • Stochastic (9, 1, 3): %K is crisscrossing %D near 70
  • Bias: Side-Up

Previous Session

Major U.S. indices closed higher on Monday, September 30 in mixed volume. Dow Jones Industrial Average and Dow Joes Transportation Average traded in higher volume others in lower volume. The indices are moving sideways with a down bias for the last few days..

From Briefing.com:

Wall Street finished higher on Monday to wrap up the third quarter. The S&P 500 (+0.5%), Dow Jones Industrial Average (+0.4%), and Nasdaq Composite (+0.8%) posted respectable gains, lifted by shares of Apple (AAPL 223.97, +5.15, +2.4%) after JP Morgan raised its price target to $265 from $243. The Russell 2000 increased 0.2%.

[…]

The 2-yr yield and the 10-yr yield finished unchanged at 1.62% and 1.68%, respectively. The U.S. Dollar Index increased 0.3% to 99.40. Gold futures, which had rallied alongside a stronger dollar this quarter, declined 2.2% (-$33.10) to $1473.30/ozt.

Monday’s economic data was limited to the Chicago PMI for September, which declined to 47.1 (Briefing.com consensus 50.8) from 50.4 in August. 50.0 is the dividing line between an expansion and contraction.

Morning Notes – Tuesday September 3, 2019

Directional Bias For The Day:

  • S&P Futures are lower;
  • The odds are for a down day – watch for break above 2913.75 for change of fortune
  • Key economic data due:
    • ISM Manufacturing PMI ( 51.2 est.; prev. 51.2 ) at 10:00 AM
    • Construction Spending  (0.3% est.; prev. -1.3%) at 10:00 AM
    • ISM Manufacturing Prices ( 47.6 est. ; prev. 45.1 ) at 10:00 AM
    • IBD/TIPP Economic Optimism ( 55.4 est.; prev. 55.1)

Markets Around The World

    • Markets in the East closed mixed – Shanghai, Tokyo and Singapore closed up; Hong Kong, Sydney, Mumbai and Seoul closed down
    • European markets are lower
    • Currencies:
Up Down
  • Dollar index
  • EUR/USD
  • GBP/USD
  • AUD/USD
  • NZD/USD
  • USD/CAD
  • INR/USD
    • USD/JPY
    • USD/CHF
  • Commodities:
    Up Down
    • NatGas
    • Gold
    • Silver
    • Platinum
    • Sugar
    • Crude Oil
    • Copper
    • Palladium
    • Coffee
    • Cotton
    • Cocoa
  • Bonds
    • 10-yrs yield closed at 1.489%, down from August 29 close of 1.516%;
    • 30-years is at 1.954%, down from 1.979%
    • 2-years yield is at 1.512%, down from 1.528%
    • The 10-Year-&-2-Year spread is at -0.023 down from -0.015
  • VIX
    • Is at 19.79, below day’s open, up from August 30 close of 18.98; above 5-day SMA 19.26
    • Recent high was 21.64 on August 28; recent low was 15.51 on August 21

Key Levels:

  • Critical support levels for S&P 500 are 2905.67, 2898.79 and 2890.03
  • Critical resistance levels for S&P 500 are 2913.32, 2916.21 and 2926.46
  • Key levels for eMini futures: break above 2913.75, the high of 2:00 AM and break below 2901.50, the low of 7:30 AM

Pre-Open

  • On Friday, at 4:00 PM, S&P future closed at 2923.25 and the index closed at 2926.46 – a spread of about -3.00 points; futures closed at 2924.75 for the day; the fair value is -1.50
  • Pre-NYSE session open, futures are lower – at 8:30 AM, S&P 500 futures were down by -15.75; Dow by -168 and NASDAQ by -34.75

Directional Bias Before Open

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

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

Monthly
  • Under Pressure
  • August was a red candle with small upper shadow and long lower shadow
    • Stochastic is forming a Bearish Divergence
    • RSI-9 is below a downtrend line from January 2018 high; forming a Bearish Divergence
  • Sequence of higher highs and higher lows since February 2016 is broken in December since then a new high has been made in May 2019
Weekly:
  • The week ending on August 30 was a green with small shadows
    • Retracing from the upper bound of a broadening pattern
    • Stochastic (9,1, 3): %K is crossing above %D; near 50
    • RSI (9) is turning up and just above 50
  • Last week was up +79.35 or +2.%; the 5-week ATR is 108.72
  • Last week’s pivot point=2906.65, R1=2960.24, R2=2994.03; S1=2872.86, S2=2819.27; R1 pivot level was breached
  • An up week; first in last five weeks and fourth in last ten weeks
  • Last swing low, 2728.81, was the low on June 3, 2018; previous all-time high of 2940.91 was breached during July 1 week; last swing high 3027.98 during the week of July 22
  • Below 10-week EMA; above 39-week SMA and 89-week SMA
  • Uptrend Under Pressure
Daily
  • A red candle that gapped up at the open but the gap was closed; small upper shadow; longer lower shadow
    • %K is above %D near 85
    • RSI-9 turning up and is above 50
  • Above 50-day EMA, 100-day SMA, 20-DAY EMA; above 200-day SMA;
  • Uptrend Under Pressure
2-Hour (e-mini future)
  • Drifted down from the upper limit of a horizontal channel near 2944.00 to near 2900.00
    • RSI-21 has declined from a high of 81.73 to near 45
    • %K is crossing above %D from near 30
  • Below 20-bar EMA, which is at/below EMA10 of EMA50
  • Bias: Up-Side
30-Minute (e-mini future)
  • Drifting down from a high of 246.50 at 5:30 AM on August 30 to near 2900.00
    • RSI-21 is moving between 40 and 50 since 10:30 AM on August 30
    • %K is crisscrossing %D around 50
    • At/below 20-bar EMA, which is below EMA10 of EMA50
  • Bias: Down-Side
15-Minute (e-mini future)
  • Bollinger Band (20, 2.0) is moving sideways to down since 11:00 PM on September 1
  • The Bollinger Band was relatively narrow from 9:45 PM tp 2:45 AM; expanding since slightly
  • Stochastic (9, 1, 3): %K is below %D near 80
  • Bias: Down-Side

Previous Session

Major U.S. indices closed mixed on Friday, August 30 in mixed volume. NASDAQ Composite and Russell 2000 closed down. Dow Jones Transportation  Average and Russell 2000 traded in lower volume. Most indices closed below their open.

For the week, the major U.S. indices closed higher in mixed volume. All S&P 500 closed higher for the week.

From Briefing.com:

The stock market finished little changed on Friday in a lackluster session before the holiday weekend. The S&P 500 (+0.1%) and Dow Jones Industrial Average (+0.2%) finished just above their flat lines, while the Nasdaq Composite (-0.1%) and Russell 2000 (-0.1%) finished slightly lower.

[…]

U.S. Treasuries finished slightly higher in a muted session. The 2-yr yield declined two basis points to 1.50%, and the 10-yr yield declined one basis point to 1.51%. The U.S. Dollar Index advanced 0.3% to 98.81.

[…]

• Personal income increased 0.1% m/m in July (Briefing.com consensus +0.4%), which was weaker than expected thanks to a 1.8% decline in personal interest income, but personal spending increased a stronger-than-expected 0.6% (Briefing.com consensus +0.5%). The PCE Price Index and core PCE Price Index, which excludes food and energy, were both up 0.2%, which was also expected.
o The key takeaway from the report is that consumer spending is solid and inflation is stable, albeit at below-target levels. All in all, there isn’t a lot of ammunition in the report for the Fed to fire off a 50-basis points rate cut at its September meeting.
• The final reading for the University of Michigan’s Index of Consumer Sentiment for August was revised down to 89.8 (Briefing.com consensus 92.4) from the preliminary reading of 92.1. The final reading for July was 98.4. The difference in final readings between July and June was the largest point drop since December 2012.
o The key takeaway from the report is the understanding that tariff issues are weighing more heavily on consumer sentiment, which threatens to temper discretionary spending activity in the months ahead.
• The Chicago PMI increased to 50.4 in August (Briefing.com consensus 48.2) from 44.4 in July.

Morning Notes – Friday August 30, 2019

Directional Bias For The Day:

  • S&P Futures are higher;
  • The odds are for an up day – watch for break below 2934.25 for change of fortune
  • Key economic data due:
    • Personal Spending (0.6% vs. 0.5% est.; prev. 0.3%) at 8:30 AM
    • Core PCE Price Index (0.2% vs. 0.3% est.; prev. 0.2%) at 8:30 AM
    • Personal Income (0.1% vs. 0.3%; prev. 0.5%) at 8:30 AM
    • Chicago PMI ( 48.1 vs. 0.2% est.; prev. 44.4) at 9:45 AM
    • Revised UoM Consumer Sentiment (92.5 est.; prev. 92.1) at 10:00 AM
    • Revise UoM Inflation Expectations (prev. 2.7%) at 10:00 AM

Markets Around The World

    • Markets in the East closed mostly up – Shanghai closed down
    • European markets are higher
    • Currencies:
Up Down
  • Dollar index
  • USD/CHF
  • AUD/USD
    • EUR/USD
    • GBP/USD
    • USD/JPY
    • NZD/USD
    • USD/CAD
    • USD/INR

 

  • Commodities:
    Up Down
    • Gold
    • Silver
    • Copper
    • Platinum
    • Palladium
    • Coffee
    • Cotton (Unch.)
    • Cocoa
    • Crude Oil
    • NatGas
    • Sugar
  • Bonds
    • 10-yrs yield is at 1.513%, down from August 29 close of 1.516%;
    • 30-years is at 1.975%, down from 1.979%
    • 2-years yield is at 1.528%, unchanged
    • The 10-Year-&-2-Year spread is at -0.015 down from -0.012
  • VIX
    • Is at 17.16 down from August 29 close of 17.88; below 5-day SMA 18.80
    • Recent high was 21.64 on August 28; recent low was 15.51 on August 21

Key Levels:

  • Critical support levels for S&P 500 are 2921.71, 2915.25 and 2905.67
  • Critical resistance levels for S&P 500 are 2944.01, 2964.19 and 2979.93
  • Key levels for eMini futures: break above 2946.50, the high of 5:30 AM and break below 2940.25, the low of 7:00 AM

Pre-Open

  • On Thursday, at 4:00 PM, S&P future closed at 2924.75 and the index closed at 2924.58 – a spread of about +0.25 points; futures closed at 2926.75 for the day; the fair value is -2.00
  • Pre-NYSE session open, futures are higher – at 9:00 AM, S&P 500 futures were up by +16.25; Dow by +140 and NASDAQ by +43.50

Directional Bias Before Open

  • Weekly: Uptrend Under Pressure
  • Daily: Uptrend Under Pressure
  • 120-Min:Up
  • 30-Min: Up
  • 15-Min: Up
  • 6-Min: Up-Side

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

Monthly
  • Under Pressure
  • July formed a shooting star type doji at all time highs
    • Stochastic is forming a Bearish Divergence
    • RSI-9 is below a downtrend line from January 2018 high; forming a Bearish Divergence
  • June 2019 was a large green Piercing or Bullish Engulfing candle that closed near the open of previous week; May was large Bearish Engulfing candle that closed near the lows
  • Sequence of higher highs and higher lows since February 2016 is broken in December since then a new high has been made in May 2019
Weekly:
  • The week ending on August 23 was a large red Bearish Engulfing with small shadows
    • Retracing from the upper bound of a broadening pattern
    • Stochastic (9,1, 3): %K is below %D; falling near 30
    • RSI (9) is near 40 and falling
  • Last week was down -41.57 or -1.4%; the 5-week ATR is 100.33
  • Last week’s pivot point=2873.72, R1=2912.47, R2=2997.83; S1=2808.36, S2=2769.61; No pivot levels were breached
  • A down week; fourth in a row and fourth in last five weeks and sixth in last ten weeks
  • Last swing low, 2728.81, was the low on June 3, 2018; previous all-time high of 2940.91 was breached during July 1 week
  • Below 10-week EMA; above 39-week SMA and 89-week SMA
  • Uptrend Under Pressure
Daily
  • A green candle that gapped up at the open; small upper and lower shadows
    • %K is above %D near 85
    • RSI-9 turning up and is above 50
  • Above 50-day EMA, 100-day SMA, 20-DAY EMA; above 200-day SMA;
  • Uptrend Under Pressure
2-Hour (e-mini future)
  • Rising from a low of 2810.25 at 6:00 PM on August 25 from the lower limit of a horizontal channel to the upper limit near 2944.00
    • RSI-21 is moving along 75 since 2:00 AM on August 29
    • %K is crisscrossing %D over 90
  • Above 20-bar EMA, which is above EMA10 of EMA50
  • Bias: Up
30-Minute (e-mini future)
  • Break above a horizontal channel between 2890.00 and 2855.00 continues; 161.8% extension target near 2946.00 is achieved
    • RSI-21 is mostly above 50 since 9:30 AM on August 28; above 65
    • %K is crisscrossing %D lower from above 90; near 80
    • Above 20-bar EMA, which is above EMA10 of EMA50
  • Bias: Up
15-Minute (e-mini future)
  • Bollinger Band (20, 2.0) is moving up since 3:00 AM on August 29
  • The Bollinger Band was relatively narrow till 3:30 AM expanding since with price walking up the upper band
  • Stochastic (9, 1, 3): %K is crossing below %D near 60; Bearish Divergence
  • Bias: Up

Previous Session

Major U.S. indices closed higher on Thursday, August 29 in mixed volume. Dow Jones Industrial Average and NASDAQ Composite traded in higher volume. Major indices gapped up at the open and did not close the gap.

From Briefing.com:

Each of the major U.S. indices rose more than 1.0% on Thursday, lifted by China indicating it wants to prevent trade tensions from further escalating. The S&P 500 (+1.3%) and Dow Jones Industrial Average (+1.3%) both increased 1.3%. The Nasdaq Composite (+1.5%) and Russell 2000 (+1.6%) pulled out ahead.

[…]

Ten of the 11 S&P 500 sectors finished in positive territory. The industrials (+1.8%) and information technology (+1.7%) sectors outperformed amid solid gains in the trade-sensitive transportation and semiconductor spaces. The Dow Jones Transportation Average increased 2.0%, and the Philadelphia Semiconductor Index increased 2.3%. The consumer staples sector (unch) was unchanged.

[…]

• The second estimate for Q2 GDP showed a downward revision to 2.0% annualized growth (Briefing.com consensus 2.0%) from 2.1% annualized growth reported in the advance estimate. The GDP Deflator was unrevised at 2.4%, as expected.
o The key takeaway from the report is that consumer spending growth was revised up to 4.7% from 4.3%, which was the strongest growth since the fourth quarter of 2014. Granted it’s a backward-looking data point, yet it offers a nice reminder that the U.S. consumer, supported by a tight labor market, has remained in good shape.
• Initial claims for the week ending August 24 increased by 4,000 to 215,000, as expected. Continuing claims for the week ending August 17 increased by 22,000 to 1.698 million.
o The key takeaway from the report is that initial claims, which are an important leading indicator, remain low. That will perpetuate the belief that there remains a good underpinning in a tight labor market for continued consumer spending growth.
• The Advance report for International Trade in Goods for July showed a deficit of $72.3 billion following an unrevised deficit of $74.2 billion. Meanwhile, the Advance report for Wholesale Inventories for July increased 0.2%, and the Advance report for Retail Inventories for July increased 0.8%.
• Pending Home Sales declined 2.5% in July (Briefing.com consensus +0.1%). Today’s reading follows an unrevised increase of 2.8% in June.

Morning Notes – Thursday August 29, 2019

Directional Bias For The Day:

  • S&P Futures are higher;
  • The odds are for an up day with elevated volatility – watch for break below 2906.25 for change of fortune
  •  Key economic data due:
    • Prelim GDP (2.0% vs. 2.0% est.; prev. 2.1%) at 8:30 AM
    • Goods Trade Balance (-72.3B vs. -74.0B est.; prev. -74.2B) at 8:30 AM
    • Prelim GDP Price Index (2.4% vs. 2.4%; prev. 2.4%) at 8:30 AM
    • Prelim Wholesale Inventories (0.2% vs. 0.2% est.; prev. 0.0%) at 8:30 AM
    • Unemployment Claims (215K vs. 215K est.; prev. 211K) at 8:30 AM
    • Pending Home Sales (0.1% est.; prev. 2.8%) at 10:00 AM

Markets Around The World

    • Markets in the East closed mixed – Hong Kong, Sydney and Singapore closed up; Shanghai, Tokyo, Mumbai and Seoul closed down
    • European markets are higher
    • Currencies:
Up Down
  • Dollar index
  • USD/JPY
  • USD/CHF
  • AUD/USD
  • NZD/USD
    • EUR/USD
    • GBP/USD
    • USD/CAD
    • USD/INR

 

  • Commodities:
    Up Down
    • Crude Oil
    • NatGas
    • Gold
    • Silver
    • Copper
    • Platinum
    • Palladium
    • Sugar
    • Coffee
    • Cotton
    • Cocoa
  • Bonds
    • 10-yrs yield is at 1.486%, up from August 28 close of 1.466%;
    • 30-years is at 1.959%, up from 1.938%
    • 2-years yield is at 1.512%, up from 1.504%
    • The 10-Year-&-2-Year spread is at -0.038 up from -0.046
  • VIX
    • Is at 18.18 down from August 28 close of 19.35 after a gap down open; below 5-day SMA 19.40
    • Recent high was 21.64 on August 28; recent low was 15.51 on August 21

Key Levels:

  • Critical support levels for S&P 500 are 2901.70, 2890.77 and 2882.70
  • Critical resistance levels for S&P 500 are 2919.58, 2927.01 and 2932.35
  • Key levels for eMini futures: break above 2919.75, the high of 8:00 AM and break below 2906.50, the low of 4:30 AM

Pre-Open

  • On Wednesday, at 4:00 PM, S&P future closed at 2888.25 and the index closed at 2887.94 – a spread of about +0.25 points; futures closed at 2889.75 for the day; the fair value is -1.50
  • Pre-NYSE session open, futures are higher – at 9:00 AM, S&P 500 futures were up by +26.50; Dow by +252 and NASDAQ by +87.50

Directional Bias Before Open

  • Weekly: Uptrend Under Pressure
  • Daily: Uptrend Under Pressure
  • 120-Min:Side-Up
  • 30-Min: Side-Up
  • 15-Min: Up-Side
  • 6-Min: Side

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

Monthly
  • Under Pressure
  • July formed a shooting star type doji at all time highs
    • Stochastic is forming a Bearish Divergence
    • RSI-9 is below a downtrend line from January 2018 high; forming a Bearish Divergence
  • June 2019 was a large green Piercing or Bullish Engulfing candle that closed near the open of previous week; May was large Bearish Engulfing candle that closed near the lows
  • Sequence of higher highs and higher lows since February 2016 is broken in December since then a new high has been made in May 2019
Weekly:
  • The week ending on August 23 was a large red Bearish Engulfing with small shadows
    • Retracing from the upper bound of a broadening pattern
    • Stochastic (9,1, 3): %K is below %D; falling near 30
    • RSI (9) is near 40 and falling
  • Last week was down -41.57 or -1.4%; the 5-week ATR is 100.33
  • Last week’s pivot point=2873.72, R1=2912.47, R2=2997.83; S1=2808.36, S2=2769.61; No pivot levels were breached
  • A down week; fourth in a row and fourth in last five weeks and sixth in last ten weeks
  • Last swing low, 2728.81, was the low on June 3, 2018; previous all-time high of 2940.91 was breached during July 1 week
  • Below 10-week EMA; above 39-week SMA and 89-week SMA
  • Uptrend Under Pressure
Daily
  • A piercing candle with small lower shadow and almost no upper shadow
    • %K is crossing above %D just below 50
    • RSI-9 turning up and is just below 50
  • Below 20-day EMA, 50-day EMA and 100-DAY SMA; above 200-day SMA;
  • Uptrend Under Pressure
2-Hour (e-mini future)
  • Breaking above from a sideways of couple of days; nearing the upper limit of a horizontal channel between 2810.00 and 2940.00;
    • RSI-21 is rising and is above 75
    • %K is above %D over 90
  • Above 20-bar EMA, which is above EMA10 of EMA50
  • Bias: Side-Up
30-Minute (e-mini future)
  • Broke above a horizontal channel between 2890.00 and 2855.00; 61.8% Fibonacci extension target is achieved near 2911.00 and the 100% extension target is near 2925.0 and 161.8% extension target is near 2946.00
    • RSI-21 is above 65 and declining; potential Bearish Divergence
    • %K is below %D from above 90; potential Bearish Divergence
    • Above 20-bar EMA, which is above EMA10 of EMA50
  • Bias: Side-Up
15-Minute (e-mini future)
  • Bollinger Band (20, 2.0) is moving up since 3:00 AM
  • The Bollinger Band was narrow from 3:30 PM to 3:00 AM; expanded till 7:45 AM with price walking up the upper band; narrowing since
  • Stochastic (9, 1, 3): %K is below %D near 50; Bearish Divergence
  • Bias: Up-Side

Previous Session

Major U.S. indices closed higher on Wednesday, August 28 in mostly lower volume that was also lower than 10-day average. Dow Jones Transportation Average traded in higher volume. Most indices made piercing candle. DTRAN made bullish engulfing pattern

From Briefing.com:

U.S. stocks finished higher on Wednesday in a broad-based advance. The S&P 500 increased 0.7%, quickly overcoming a negative start that was attributed to declining Treasury yields and finished near session highs.

The blue-chip Dow Jones Industrial Average increased 1.0%, the tech-sensitive Nasdaq Composite increased 0.4%, and the small-cap Russell 2000 increased 1.2%.

[…]

Yields came off session lows soon after stocks opened for trading, though, allowing risk sentiment to ease its way back into a flustered stock market. The 2-yr and 10-yr yields declined two basis points each to 1.51% and 1.47%, respectively. The U.S. Dollar Index increased 0.3% to 98.26.

Ten of the 11 S&P 500 sectors finished the day in positive territory. Energy (+1.4%), consumer discretionary (+1.1%), and industrials (+1.1%) set the pace, while the utilities sector (-0.3%) was the lone holdout. The energy sector entered today’s session down over 10% in August, but it found some reprieve amid higher oil prices ($55.76/bbl, +$0.86, +1.6%) following bullish inventory data.

[…]

Wednesday’s economic data was limited to the weekly MBA Mortgage Applications Index, which declined 6.2% following a 0.9% decline in the prior week.

Morning Notes – Wednesday August 28, 2019

Directional Bias For The Day:

  • S&P Futures are lower;
  • The odds are for a down day with elevated volatility – watch for break above 2878.00 for change of fortune
  • The 61.8% Fibonacci retracement of the big decline on Friday – from 2936.50 to 2810.25 – is achieved near 2888.00; the 78.6% Fibonacci retracement is near 2909.00 after a resistance level near 2901.00
  • No key economic data due:

Markets Around The World

    • Markets in the East closed mixed – Shanghai, Hong Kong, Mumbai and Singapore closed down; Tokyo, Sydney and Seoul closed up
    • European markets are lower
    • Currencies:
Up Down
  • Dollar index
  • USD/JPY
  • USD/CHF
  • USD/CAD
  • USD/INR
    • EUR/USD
    • GBP/USD
    • AUD/USD
    • NZD/USD

 

  • Commodities:
    Up Down
    • Crude Oil
    • NatGas
    • Gold (Unch.)
    • Silver
    • Copper
    • Platinum
    • Coffee
    • Cotton
    • Palladium
    • Sugar
    • Cocoa
  • Bonds
    • 10-yrs yield is at 1.463%, down from August 27 close of 1.490%;
    • 30-years is at 1.920%, down from 1.969%
    • 2-years yield is at 1.500%, down from 1.536%
    • The 10-Year-&-2-Year spread is at -0.037 up from -0.046
  • VIX
    • Is at 21.24 up from August 27 close of 20.31; Above 5-day SMA 19.48
    • Recent high was 24.10 on August 15; recent low was 15.51 on August 21

Key Levels:

  • Critical support levels for S&P 500 are 2867.41, 2860.59 and 2856.00
  • Critical resistance levels for S&P 500 are 2875.79, 2881.28 and 2898.79
  • Key levels for eMini futures: break above 2869.50, the high of 7:00 AM and break below 2854.25, the low of 8:00 AM

Pre-Open

  • On Tuesday, at 4:00 PM, S&P future closed at 2868.00 and the index closed at 2879.16 – a spread of about -1.25 points; futures closed at 2865.50 for the day; the fair value is +2.50
  • Pre-NYSE session open, futures are lower – at 9:00 AM, S&P 500 futures were down by -3.75; Dow by -38 and NASDAQ by -15.75

Directional Bias Before Open

  • Weekly: Uptrend Under Pressure
  • Daily: Uptrend Under Pressure
  • 120-Min:Side
  • 30-Min: Side-Down
  • 15-Min: Side-Down
  • 6-Min: Down

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

Monthly
  • Under Pressure
  • July formed a shooting star type doji at all time highs
    • Stochastic is forming a Bearish Divergence
    • RSI-9 is below a downtrend line from January 2018 high; forming a Bearish Divergence
  • June 2019 was a large green Piercing or Bullish Engulfing candle that closed near the open of previous week; May was large Bearish Engulfing candle that closed near the lows
  • Sequence of higher highs and higher lows since February 2016 is broken in December since then a new high has been made in May 2019
Weekly:
  • The week ending on August 23 was a large red Bearish Engulfing with small shadows
    • Retracing from the upper bound of a broadening pattern
    • Stochastic (9,1, 3): %K is below %D; falling near 30
    • RSI (9) is near 40 and falling
  • Last week was down -41.57 or -1.4%; the 5-week ATR is 100.33
  • Last week’s pivot point=2873.72, R1=2912.47, R2=2997.83; S1=2808.36, S2=2769.61; No pivot levels were breached
  • A down week; fourth in a row and fourth in last five weeks and sixth in last ten weeks
  • Last swing low, 2728.81, was the low on June 3, 2018; previous all-time high of 2940.91 was breached during July 1 week
  • Below 10-week EMA; above 39-week SMA and 89-week SMA
  • Uptrend Under Pressure
Daily
  • A near bearish engulfing candle with small shadows
    • %K is below %D near 30
    • RSI-9 turning down near 40
  • Below 20-day EMA, 50-day EMA and 100-DAY SMA; above 200-day SMA;
  • Uptrend Under Pressure
2-Hour (e-mini future)
  • Moving sideways to down; near the middle of a horizontal channel between 2810.00 and 2940.00;
    • RSI-21 is declining near 30
    • %K is crisscrossing %D near 30
  • Below 20-bar EMA, which is below EMA10 of EMA50
  • Bias: Side
30-Minute (e-mini future)
  • Moving sideways to down near the lower bound of a horizontal channel between 2899.00 and 2855.00
    • RSI-21 has declined below 40
    • %K is crisscrossing %D lower
    • Below 20-bar EMA, which is below EMA10 of EMA50
  • Bias: Side-Down
15-Minute (e-mini future)
  • Bollinger Band (20, 2.0) is moving sideways to down since 4:30 PM
  • The Bollinger Band was narrow from 4:30 PM to 7:00 AM; expanding since with price walking down the lower band
  • Stochastic (9, 1, 3): %K is crisscrossing %D near 20
  • Bias: Side-Down

Previous Session

Major U.S. indices closed lower on Tuesday, August 27 in mostly higher volume that was lower than 10-day average. S&P 500 traded in lower volume. Most indices made bearish engulfing over small harami patterns with small shadows.

From Briefing.com:

The stock market finished lower on Tuesday in a shaky session. The S&P 500 jumped 0.7% out of the gate after yesterday’s advance, then declined as much 0.6% as Treasury yields took a noticeable leg lower. The broader market spent most of the afternoon wavering in negative territory, leaving the S&P 500 with a 0.3% loss.

The Dow Jones Industrial Average (-0.5%) and Nasdaq Composite (-0.3%) performed similarly to the benchmark index. The Russell 2000 dropped 1.4%, largely due to weakness in many of the energy and financial stocks.

[…]

Specifically, the 2s10s spread inversion widened to four basis points, which isn’t terribly conducive for lending activity. The 2-yr yield declined two basis points to 1.53%, and the 10-yr yield declined six basis points to 1.49%. The U.S. Dollar Index was little changed at 98.04. WTI crude rose 2.4% to $54.90/bbl.

[…]

• The Conference Board’s Consumer Confidence Index for August printed at 135.1 (Briefing.com consensus 129.6) versus an upwardly revised 135.8 (from 135.7) in July, which was the third highest reading since October 2000.
o The key takeaway from the report is that it reflects a pretty solid state of consumer confidence, which is a supportive foundation for continued discretionary spending. That matters greatly for an economy driven predominantly by consumer spending.
• The FHFA Housing Price Index for June increased 0.2% following a revised 0.2% increase in May (from 0.1%).
• The S&P Case-Shiller Home Price Index for June increased 2.1% (Briefing.com consensus of 2.7%) following a 2.4% increase in May.