Directional Bias For The Day:

• S&P 500 future is drifting higher, following through on Friday’s gap-up open and a large range positive day
• On 2-hour chart, S&P 500 future broke above a rectangle trading range on Friday and is now testing the resistance-turned-support
• Critical support levels for S&P 500 are 2179.57, 2177.43 and 2168.79
• Critical resistance levels for S&P 500 are 2187.56, 2192.56 and 2201,64
• Early morning futures price action is slightly to the upside; at 8:30 AM, S&P 500 future was up by +2.50, Dow was up by +22.00 and NASDAQ was up by +7.75

Before NYSE Session Open

Major US indices were positive on Friday after a good Non-Farm Payroll report. Major indices gapped-up at the NYSE session open and stayed up for the rest of the day.

NASDAQ Composite and Russell 2000 continued their streak of positive weeks to six. NASDAQ gained +58.99 or +1.1% and Russell gained +11.36 or +0.9% for the week. S&P 500 and Dow Jones Industrial Averages were also up for the week. They have been positive in five out of last six weeks. S&P 500 gained +9.27 or +0.4% and Dow gained +111.29 or +0.6% for the week.

Asian Session

Asian bourses were up on Monday buoyed by the good U.S. employment report on Friday.

• Shanghai Composite was up by +27.58 or +0.93% to 3004.28; it is knocking on a resistance level – the July 27th high of 3003.23 – and the next resistance is at 3057.42
• Hang Seng was gapped-up and closed up by +348.67 or +1.57% to 22494.76; it cleared the recent resistance of is 2016 high; the next resistance level on weekly time-frame is 2015 high of 234323.64, which is 4.2% away from current price
• Nikkei 225 was up by +396.12 or +2.44% to 16650.57 and is headed toward 16938.96
• Sydney’s S&P/ASX 200 was up by +40.40 or +0..73% to 5537.80; it is at a critical level and the next meaningful resistance level is at 5611.20
• Sensex was up by +104.2 or +0.37% to 28182.57;
• South Korea’s KOSPI gained +13.18 or +0.65% to close at 2031.12;

European Session

In pre-US session, the European stock markets are mixed.

• DAX is up by +57.77 or +0.56% to 10424.98; however, it is near the lows of the day; on weekly time-frame the price is finding a resistance at the down trend line
• FTSE-100 is down by -8.41 or -0.12% to 6785.06; on Friday, it continued on the reversal started on August 3rd and cleared the 2016 high resistance
• CAC-40 is up by +0.14% to 4416.52; like DAX, it too is finding a resistance at the downtrend line
• Spanish IBEX is up by +0.40% to 8573.40; similar to CAC-40, it is at the lower end of the day’s range and also down for the last week
• Italian FTSE MIB is up by +0.60% to 16725.57; its price action is similar to that of CAC-40 and IBEX
• Swiss SMI-SWX is down by -0.29% to 8170.88;
• STOXX-600 is down by -0.06% to 341.19

Currencies

• U.S. Dollar index is up by +0.174 to 96.31;
• EUR/USD is up by +4.9 pips to 1.10859;
• GBP/USD is down by -25.0 pips to 1.3043;
• USD/JPY is up by +65.6 pips (Yen is weaker) to 102.477;

Commodities

• WTI Crude is up by +0.65 or +1.56% to 42.45;
• Natural Gas is down by -1.44% to 2.732
• Gold is down by -4.20 or -0.04% to 1340.20; Silver is down by -0.012 or -0.06% to 19.800
• Copper is up by +0.81% to 2.1715

Yields

• U.S. Treasury yields are up for the day so far
• 30-year yield is up by +0.8 basis points to 2.318% and 10-year is up by +13.0 basis points to 1.595%

Pivot Levels:

S&P 500 is above its 10-D EMA, 10-D EMA is above 20-D EMA and its 20-D EMA is trending above 50-D EMA since March 9, 2016.

Note: The probability of a level breaking is shown above is for the current condition when the price is above 20-D EMA, 10-D EMA is above 20-D EMA and 20-D EMA is above 50-D EMA. R2 break probability comes in picture only when R1 is broken. So are the probabilities calculated for R3, S2 and S3