Category Archives: S&P500 Futures Technical Analysis

Emini Futures Trading Update – 23May2016

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Our trading last week was far from optimal, and we had many stop losses from the daily change in market direction, just around our key level of 2053 in futures. The US Fed rate hike scenario in June significantly increased volatility and paused the upmove of the S&P500 which was clearly visible till a week back. In fact, we had a profitable trade with 15 points running when the US Fed meeting notes came out and that trade went down to hit 10 point stop loss within minutes.

Please see the chart below. The S&P500 futures have been trading in a narrow channel of about 45 points band, and they have been changing direction almost everyday, thereby hitting any stop loss that is less than 20-25 points, and then targets of 10-15 point targets are getting hit. Its like a mixer and its not profitable.
spx-daily-chart-23may2016

In such a scenario, the only way to trade without sacrificing stop losses is to widen the stop loss to the outer levels of the channel. So the stop for long trade would be 2020, and stop for short trade would be 2060 on the futures.

The uptrend which started in Feb has been closed in May after last week’s movement, and now there is a strong bias for downside moves. Long trades should be taken only above 2060, or at the lower end of the channel around 2025-2030 with a tight stop of 2020.

Emini Futures Trading Update – 13Apr2016

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Wednesday, April 13, 2016, 9.45am, New York – Hello Folks, the futures are currently at 2069. For Trade#2 of April, our target of 2067 has been hit successfully today morning. I was expecting it to come by Friday as mentioned in the email last evening. But the momentum is strong and our target got hit today morning itself. This completes Trade#2, with 28 points gain from.

Trade#2 of April 2016 (completed)
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Buy at: 2039
Target: 2067 (hit on April 13, 2016)
Stop: 2030
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This trade has moved fast, and its good we took this immediately after our Stop Loss on Trade#1. We will wait for the index to take a breather after the hectic 40 point upmove from 2030 to 2070 in the last 2 days since Monday morning, and then decide our next trade.

[Emini Futures Trading Strategy] The S&P500 has strong resistance at 2075-2080 level, which translates to about 2070-2073 levels on the SPX/ES futures. However, the S&P500 index is in positive buy zone above 2058, which translates to about 2050 level of the futures. If the S&P500 index goes below 2000 for any reason, all longs must be closed. Of course we will be having predefined Stops much above 2000 level.

[Bonus Trade] Large Traders with 5-10 contracts: You may Sell 2-3 contracts at 2068, for Target 2058, and Stop 2075. This is a tactical trade that aims to benefit from the inevitable profit booking that may come today or tomorrow. Thanks & Best Wishes.

Emini Futures Trading Update – 12Apr2016

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spx-daily-chart-12apr2016

Technical Analysis of S&P500 Index Futures

RSI Indicator: RSI is in neutral territory. (RSI is at 60.57). This indicator issues buy signals when the RSI line dips below the bottom line into the oversold zone; a sell signal is generated when the RSI rises above the top line into the overbought zone. RSI is somewhat overbought (RSI is at 60.57). However, this by itself isn’t a strong enough indication to signal a trade. Look for additional evidence before getting bearish.

CCI Indicator: CCI (57.58) is in neutral territory. A signal is generated only when the CCI crosses above or below the neutral center region. CCI often misses the early part of a new move because of the large amount of time spent out of the market in the neutral region. Initiating signals when CCI crosses zero, rather than waiting for CCI to cross out of the neutral region can often help overcome this. Given this interpretation, CCI (57.58) is currently long. The current long position position will be reversed when the CCI crosses below zero. Continue reading →

Emini Futures Trading Update – 18Mar2016

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sp500-emini-futures-weekly-chart-18mar2016

S&P500 Technical Analysis – for Week of 18 March 2016

The above weekly chart of S&P500 Emini Futures indicates a triple bottom at 1850, and hence a strong bounce back, which has the strength to go all the way till 2100. We have got 5 green weeks back to back, which is one of the most powerful rallies in recent years. Above 2100, the market opinion will be very divided, and there will be enough people willing to short, and any further advances above 2100 will need good support from strong corporate earnings and global macroeconomics data.

Moving Average Indicator: The market is very BULLISH. Everything in this indicator is pointing to higher prices: the fast average is above the slow average; the fast average is on an upward slope from the previous bar; the slow average is on an upward slope from the previous bar; and price is above the fast average and the slow average. Market trend is UP as long as the S&P500 index is above 2000 level.

Momentum Indicator: Momentum (138) is way above zero, indicating an overbought market. The long term trend, based on a 45 bar moving average, is DOWN. The short term trend, based on a 9 bar moving average, is UP. Momentum is indicating an overbought market. However the market may continue to become more overbought. Look for further evidence of weakness before getting bearish here. Momentum is likely to increase above 2050 on S&P500 index. So avoid short positions above 2050. Continue reading →

S&P500 Futures Technical Analysis – 21Jan2016

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sp500-emini-futures-daily-chart-21jan2016

Today was a bullish candlestick within a relatively tight range (almost a doji), which  arrested all selling pressure, and today’s high is higher than yesterday’s high, indicating willingness to go up, if market conditions become favorable. If the S&P500 futures open with a gap up tomorrow (Friday, 22 Jan 2016), then there is a high probability of a good upmove tomorrow, as a result of two bullish candles on previous two days. The immediate target on futures is 1900, which may come in the next 1-2 trading sessions. Continue reading →