Stock Market Futures Lower In Downside Continuation

Stock market futures are trading sharply lower this morning. A cascade of selling on Friday continued after the break of the 1902 contested levels. A key price support zone at 1864 has also been broken and we remain below it this morning after another big washout lower.

The Morning Report: Broken Support Friday Allows Downside Continuation

Stock market futures price support levels seem to be giving way quickly as buyers step out of the way in the advance of sellers. With some divergence present, however, we could bounce off these morning lows into resistance (old support) before heading lower. Bounces are likely to be sold, though – but watch to see if support begins to firm up.

Intraday resistance on S&P 500 futures sits near 1866. Intraday support sits at 1845. The big form has been broken in the short cycles here; hence, deeper pullbacks should continue – now expecting to see lower relative lows –with a another key test on the horizon near 1838.

Stock market futures (across the board) still sit in jagged trading ranges- all the while underlying momentum holds a slightly positive drift as we test these old support levels.

Shorter time frame momentum indicators are sitting in negative territory. Longer cycles are downward trending and holding steady in negative territory.

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

THE RANGE OF TUESDAY’S MOTION

Crude Oil Futures (CL_F)

Crude Oil futures continue to trade like it is trying to base. Buyers are stationed between 29.54- 29.96

Today, the trading ranges for crude oil futures are wide -between 29.9 and 30.98, with breaches leading to continuation. Failure to breach the 30.9 region suggests that momentum brings us near the test of 29.9 again and perhaps another dip lower if buyers fail to come in at key support levels.

Moving averages in crude oil are mixed but still lifting from a bigger picture across time frames – daily charts still show higher lows. Slower averages suggest selling bounces while faster averages suggest buying off support. This gives rise to our current and prolonged jagged price action.

Intraday long trading setups for crude oil futures suggest a long off 30.45 retest or 30.15 (with momentum showing positive, else that brings a lower high) into 30.74, 30.94, 31.38, 31.67, 31.85, 32.05, and perhaps 32.47 if range expands

Intraday short trading setups for crude suggest a short below a 30.9 failed retest or a failed retest of 29.9 with negative divergence showing sends us to 30.55, 30.35, 30.16, 29.94, 29.75, 29.54, 29.22 and perhaps 28.98.  Aggressive selling could arise at any time below 29.96, so be careful trying to catch bottoms.

E-mini S&P 500 Futures  (ES_F)  

Below is a S&P 500 futures chart with price support and resistance trading levels for today. Click to enlarge.

The S&P 500 futures chart is holding steady near deeper support levels -1851. A region of important support to maintain remains near 1845-1847.

Upside motion has the best setup on the breach of and positive retest of 1855 – or a retest after expansion above 1857.5. S&P 500f futures targets from 1857.5 are 1861.25, 1864, 1866, 1868, 1871 and if we can catch a bid there, we could recapture 1880 -1886. Big resistance test sits at the region between 1884-1889. Be careful- watch the higher lows to keep you on the right side of the long trade.

Downside motion opens below the failed retest of 1851 or at the failure to hold 1864 bounce. Retracement into lower levels from 1860 gives us the targets at 1854.5, 1851.25, 1847.75, 1845.5, 1842, and perhaps 1838.25.  Below there, we have significant drops likely. 1763, 1721, and 1614 lie below as potential target zones if buyers do not provide support.

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 traders remain 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.