S&P 500 Futures Trading Outlook For October 7

Stock Market Outlook for October 7, 2016 –

Non farm payrolls will will bring movement to the S&P 500 (INDEXSP:.INX) today, Gold is still in a messy down drift, and currency markets are jittery over the flash crash and recovery of the GBP (british pound). In the midst, US stock market futures are holding steady for now, though are a little down from yesterday. Sellers are still piled up near 2156 on S&P 500 futures – this level represents new resistance. The labor number is a double-edged sword – a recovering economy could be one of the signals the FOMC will raise rates while a weak number may hold interest rates at bay (but signal a stalled economy). The breakout level  on S&P 500 futures remains 2168. Current price support holds at 2140 for now.

See today’s economic calendar with a rundown of releases.

TODAY’S RANGE OF MOTION

S&P 500 Futures Trading Outlook For October 7

Upside trades on S&P 500 futures – Favorable setups sit on the positive retest of 2156.25, or a positive retest of the bounce off 2141.25 with upward momentum. Charts continue to be congested in these price ranges, so trading is likely to be choppy. I use the 30min to 1hr chart for the breach and retest mechanic. Targets from 2141.25 are 2145.25, 2151.25, 2156, 2157.75, 2160.25, 2163.25, and 2167.5 to 2172.

Downside trades on S&P 500 futures – Favorable setups sit below the failed retest of 2146, or at the failed retest of 2151 with negative divergence. Retracements into lower levels from 2151 give us the targets 2148.25, 2145, 2141.25, 2136.25, 2134.25, 2132.5 and 2130.5 to 2122.5. As always, additional targets will be in the Members only portion of the morning blog, and in the live trading room.

Nasdaq Futures

The NQ_F still holds higher lows as we sit now for the third day, but we have been unable to breach higher. Support still holds at 4848, with 4845, and 4836 below that. Resistance sits between 4881 and 4886 – with lots of sellers holding the price from advancing. Momentum is mixed – breakouts are still not likely to hold, while pullbacks into support may continue to be bought, even as support tests get deeper.

Upside trades Nasdaq futures – Favorable setups sit on the positive retest of 4872.75, or a positive retest of 4856.25 with positive momentum. I use the 30min to 1hr chart for the breach and retest mechanic. Targets from 4856.25 are 4860.5, 4862, 4867.5, 4870.25, 4874.25, 4876.25, 4880.25, 4884, and 4887.25 to 4890.

Downside trades-Favorable setups sit below the failed retest of 4852.5, or at the failed retest of 4871 with negative divergence. Retracements into lower levels from 4871 are 4867.5, 4862.25, 4857.75, 4852.75, 4849.75, 4845.75, 4841.75, 4836.25, 4830.5, and 4824.75. See the blog for additional targets.

Crude Oil

Though we sit very close to important resistance, buyers hold an aggressive stance, and pullbacks ought to be bought – I suspect they might be deep, and allow for fair countertrend short trades. Buyers are bound by heavy resistance near 50.57, with 50.74, and 50.9 above.

Trading ranges on crude oil should hold between 49.6 and 50.9 in the current pattern.

Upside trades on crude oil can be staged on the positive retest of 50.57, or at a positive retest off 49.64 with positive momentum. I often use the 30min to 1hr chart for the breach and retest mechanic. Targets from 49.64 are 49.75, 49.96, 50.16, 50.32, 50.54, 50.74, and 50.9.

Downside trades can be staged on the failed retest of 50.35, or at the failed retest of 50.74 with negative divergence. Targets from 50.74 are , 50.52, 50.34, 50.16, 49.96, 49.74, 49.52, 49.3, and 48.97.

If you’re interested in watching these trades go live, join us in the live trading room from 9am to 11:30am each trading day.

Visit TheTradingBook.com for more information.

If you’re interested in the live trading room, it is now primarily stock market 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:  @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.