A Jack of Small Trades

S&P futures sold off from Monday’s high at 2055 during the overnight session and pulled back to 2025: 29.75 points (1.4%) below the closing range high.

On Monday, S&P futures traded back up into Friday’s trading range, filling the “gap” at Friday’s close 2042 and auctioning up to Friday’s high at or near 2057.  

While the outcome of Monday’s session appeared to place the S&P on the price trajectory to re-test the 01-07-15 high at 2062, selling pressure emerged during the overnight session and S&P futures sold back down to re-test Sunday’s Globex low.

The reversal during the overnight session raised concerns about the market direction ahead of a two-day FOMC meeting that gets underway later today.

Earlier in the month the broad benchmark S&P sold down to the 12-16-14 low at or near 1970. Friday’s rally up to the 01-16-15 high at 2062: 92 points (4.6%) marked a recovery attempt.

Yesterday, the U.S. markets

After “gapping” below Friday’s close at 2043 and selling down to the prior fractal highs at or near 2025 at the open of Sunday’s Globex session the broad benchmark S&P 500 close above Friday’s finishing the session at 2054.

On Friday S&P futures sold down below the initial retracement up to 2062 equal to the 01-07-15 high. The 16.25 point pull-back was approximately an average daily range. S&P futures traded up 11 points above Friday’s 2048 pull-back level, but “paused” at the high where the auctioned encountered buying interest waning.  Later in the day the S&P sold down from 2057, breached support below the opening range low 2048 and traded lower into the close 2043.

S&P futures traded about the 2025 “gap” low, auctioning up to 2035, before recovering back up to Friday’s close 2043, Friday’s low. 2047: 21 points above the overnight low.

At the open the market encountered a lack of buying interest above Friday’s low 2047 and the S&P sold down 12 points and pulled back to 2034, the price level where the S&P rallied off the low and “paused prior to filling the “gap” at the open.

During the mid-day session S&P futures had difficulty trading above 2048. However, late in the day buying interest returned and after pulling back to 2045, the S&P rallied up to 2054: 20.50 points above Monday’s opening range low.

While the S&P has not traded above January resistance at 2062 the price trajectory is arguably on the path to re-test Friday high; the 01-07-15 high at 2062. The remaining distance to the all-time record high 2088 is 26 points above Friday’s high.  A rallying up to the December high would be an extreme price excursion.

A retreatment to 2088

Wednesday’s Overnight Session

S&P futures traded higher in the overnight session, auctioning above the prior day’s high 2034 and rallying up to 2047, as of this post.

On Wednesday, S&P futures traded up to 2032, modestly above what had been near term resistance at 2024-2028. The rally lost momentum (lack of buying interest) and selling pressure resulted in price auctioning down 16.50 points to 2016.  A later in the day recovery was unable to auction price back to re-test the opening range high 2032 and price action stalled at or 2028.

The current overnight high at 2048 is 30.75 points above the closing range pull-back level 2016 and at this stage in the development represents minor range extension (14 points) above yesterday’s high.

In the broader context, on 01-08-15 S&P futures sold down from 2064 to close the session at 2033. The following day selling pressure continued with the S&P trading down to 2014, before short covering back up to 2052, the nearest high above the current overnight high 2039.

The 01-13-15 short covering rally up to 2052 was followed by a 68 points (3.3%) sell-off to 1984. On 01-14-15 another short covering rally auction S&P futures above 1980, up to 2027; 47 points ( 2.3%) only to see S&P futures sell back down below the 01-14-15 day session low and make a new low on 01-15-15 at 1870.

Measuring the current trading range based on the nearest low at 1960 (12-15-14) and the new all-time record high at 2089 (12-28-14) S&P futures is currently trading in a 129 points range.

The mid-point of the trading range is 2024. The upper quadrant (75%) of the trading range is located at 2058. The maximum value is the all-time record high at 2089.

The rally above the 2000 marked the beginning of the recovery rally from a technical perspective.

However, the economic conditions have not significantly changed and there is little in the way of rational to support the S&P trading above 2088-2100

However, the currently market condition indicates support at or near 20009-1998 and resistance at 2052.



Billy 

Sunday’s Overnight Globex Session

S&P futures traded higher during Sunday’s overnight globex session, auctioning up to 2023, 10 points above Friday’s close and 4 points below the next know high at 2028.

Following the rally up to the overnight high at 2023, S&P futures pulled back 20 points in search of support. Coming into Sunday’ssession we noted the near term support was likely to be found at or near 2003-2001.

The rally up to Sunday’s overnight globex high was a gain of 42.50 points above Friday’s fractal low at 1980. The pull-back to 2003 equaled the half way back point and a re-test of the 2000 over under price level.

On Friday, the major U.S. benchmark averages recovered from a five day decline. The Dow rallied 1.1%, the tech-heavy Nasdaq recovered 1.4% and the S&P 500 gained 1.3%.

The price of crude oil traded higher, while economic data was mixed data showing a modest pullback in industrial production. Consumer confidence reportedly improved and weakening core inflation.

  

Speculation in the financial media that a benign inflationary and the decline in the commodity environment would make case for the Federal Reserve delaying the 1st interest rate increase.

Regardless of the cause of the rally, support held on Friday at or near 12-16-14: 1970-1960: 117 points (5.6%) below the 12-28-14 all-time record high in the S&P 500.

The 2003-2000 price level is currently support in the S&P March futures. A breach of support at 2000-2003 would be a negative development. A breach of support increases the likelihood that the S&P will re-test of the 1981 price levels.

In the context in the current market “State”; in the event of a re-test of Friday’s low there is the possible of a lower low. Support at 1961the 12-16-14 low in the next down-side price level.  

Subcategories