S&P 500 In The Green Following Cash Open

The March E-mini S&P 500 has posted moderate early gains. Price is rotating in the 2636.00 area, above daily downside support.

Written by: Dime Levov • Wednesday, January 23, 2019 • 1 min read

• Last updated: Wednesday, January 23, 2019

This morning has brought a positive Wall Street open. Following concerns over global economic growth and pending impact of the U.S. government shutdown, the indices had a tough Tuesday session. Today’s action is no doubt a welcomed sight for equities bulls, featuring opening hour gains in the DJIA, S&P 500 SPX, and NASDAQ.

The U.S. economic calendar is sparsely populated this week. However, there were a few peripheral metrics released during the pre-cash open hours:

Event Actual Previous

MBA Mortgage Applications (Jan. 18) -2.7% 13.5%

Redbook Index (MoM, Jan. 18) -1.5% -1.7%

Housing Price Index (MoM, Dec.) 0.4% 0.4%

Richmond FED Manufacturing Index (Jan.) -2 -8

All in all, the numbers are not overly strong. Nonetheless, aside from lagging MBA Mortgage Applications, this set of metrics represents a monthly improvement.

The S&P 500 Is On The Bull

At press time, the March E-mini S&P 500 is in the process of giving back early gains. Price is rotating in the 2636.00 area, above daily downside support.

March E-mini S&P 500 Futures (ES), Daily Chart

Here are two support levels that may come into play later on in the session:

Support(1): Bollinger MP, 2594.00
Support(2): 38% Current Wave Retracement, 2586.50

Bottom Line: Tuesday’s negative close marked the first two-day losing streak since January 2nd and 3rd. It is very early to tell, but a significant pullback in 2019’s bull run may be on the horizon.

As long as the Swing High (2677.75) remains valid, I will have buys queued up from 2587.25. With an initial stop at 2582.25, this trade produces 20 ticks on a bounce from the 38% Current Wave Fibonacci support level.