S&P 500 Futures Outlook For Traders (Broad Overview) for August 22, 2016 –Â After an absence of several days in the market, I returned to see charts just as range bound. Typical summer trading behavior. Perhaps traders are waiting on the election, or some other market moving news. But whatever the case, we are likely to have sideways action on the S&P 500 (INDEXSP:.INX).
A breach above 2184.75 on S&P 500 futures may only take us to the top of congestion near 2186.5. Stock market momentum indicators are flat, suggesting range bound motion. Price support sits near 2172.25 with 2169.5 below that. Price resistance remains near 2186.5, but could stretch into 2190.5 if traders try to breakout to the upside.
See today’s economic calendar with a rundown of releases.
RANGE OF TODAY’S MOTION
S&P 500 Futures Outlook For August 22 – ES_F Trading Chart
Upside trades on S&P 500 futures – Favorable setups sit on the positive retest of 2184.75, or a positive retest of the bounce off 2175.5 with upward momentum. If we spike downward into 2169.75, it should prove out as a bounce zone, as well. I use the 30min to 1hr chart for the breach and retest mechanic. Targets from 2175.5 are 2179.75, 2181.75, 2184.5, 2186.25, 2189.5, 2191.5, 2193.25, and if we expand, we may stretch above into 2197.75 and 2199.75. Breakouts that hold seem very unlikely in this environment.
Downside trades on S&P 500 futures – Favorable setups sit below the failed retest of 2175.5, or at the failed retest of 2183 with negative divergence. Keep your eyes on the lookout for higher lows developing intraday. Retracement into lower levels from 2183 gives us the targets 2180.5, 2177.75, 2175.5, 2172.25, 2169.5, 2165.5, 2162, 2158.5, and 2154.75, if sellers take over. Breakdowns that hold seem very unlikely in this environment.
Nasdaq Futures (NQ_F)
After a wide range test last week, the NQ_F has settled into trading ranges between 4780 and 4817. Momentum is flat, suggesting sideways motion. Upper support sits at 4792.75. Below that, we see congestion near 4788.5 -4780.5 that will serve as lower support. Resistance is lower today, between 4814.75-4820.75, with a breach that could stretch into 4832, if buyers try to recapture gains. Pay attention to lower highs or lower lows developing, as this could signal a continuation of downside action.
Upside trades on Nasdaq futures – Favorable setups sit on the positive retest of 4806.75, or a positive retest of 4798.5 with positive momentum. I use the 30min to 1hr chart for the breach and retest mechanic. Targets from 4798.5 are 4802.75, 4806.5, 4810.75, 4813, 4817.25, 4822.75, 4828.25, 4832, 4835.75, 4838.5, and 4844.25, if buyers continue the rally north.
Downside trades on Nasdaq futures – Favorable setups sit below the failed retest of 4796.75, or at the failed retest of 4805.25 with negative divergence (particularly important here). Retracement into lower levels from 4805.25 gives us the targets 4801.75, 4796.75, 4792.75, 4790.25, 4788.5, 4785.5, 4777.75, and 4771.5 to 4767.5, if sellers resume control.
Crude Oil
Oil contracts have staged a remarkable rally for the last ten days, and rallies like this have a tough time holding gains under thin volume. The volume here has not been remarkably thin, however, so we may have a jagged retrace back down into 46.4, then 45.5. Support holds at 47.6, but a failed bounce into 48.3 could make for a test of lower levels later in the week. Resistance sits near 48.06, with 48.55 above that. Recent gap action from a contract roll is present on composite charts, so a drift into that region is likely.
Trading ranges for crude oil should hold between 46.4 and 49.05 today.
Upside trades on crude oil futures can be staged on the positive retest of 48.05, or at a positive retest off 47.55 with positive momentum. I often use the 30min to 1hr chart for the breach and retest mechanic. Targets from 47.55 are 47.96, 48.05, 48.18, 48.49, 48.7, 49.06, and the outside chance that we see 49.48, if buyers power forward.
Downside trades on crude oil futures can be staged on the failed retest of 47.6, or at the failed retest of 48.46 with negative divergence. There is also a short sitting at range expansion into 48.86, but caution is required there. Targets from 48.46 are 48.18, 48.05, 47.84, 46.79, 47.6, 46.49, 46.27, 46.24, 46.07, 45.94, and 45.57, if sellers really resume control.
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If you’re interested in the live trading room, it is now primarily futures content, though we do track heavily traded stocks and their likely daily trajectories as well – we begin at 9am with a morning report and likely chart movements along with trade setups for the day.
As long as the trader keeps himself aware of support and resistance levels, risk can be very adequately managed to play in either direction as bottom picking remains a behavior pattern that is developing with value buyers and speculative traders.
Twitter:Â Â @AnneMarieTrades
The author trades stock market futures every day and may have a position in mentioned securities at the time of publication. Any opinions expressed herein are solely those of the author, and do not in any way represent the views or opinions of any other person or entity.
