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Uptrend Holds Again – Daily Stock Market Setup – May 13, 2020

Last night the S&P futures needed to break 2828 to break the uptrend. Of course it did it by 5 points, and that was it. Boom! Up, up, and away!

Stock Market Trading Setup for Tuesday, May 13, 2020

S&P Futures Daily Chart 

Liquidity moves markets!

Follow the money. Find the profits! 

Yesterday’s post.

The ES futures were up 20 at 2872 at 8:15 AM in New York.That’s down 56 from where they were this time yesterday. At the same time, it’s up 47 from the overnight low. Tradable? Only if you are staying awake all day and all night and trading the 5 minute bars. 

Or if your name is Algo.

They have traded in a range of 2825 to 2876 overnight and this morning. They came off the lower uptrend channel line and are now about 35 points above that line, give or take a few.  

Other than that trendline, additional support levels are around 2780, and possibly 2742, with the big one at 2706. Bears need to break that to show a downside reversal. 

ES Futures Chart

The daily oscillators tuned to an 8 week cycle are mixed, befitting the 4 week trading range. There’s no sign of a breakout either way yet. But a big move is probably coming, once the range breaks.

Rate of Change continues moving sideways near the zero line. Upturns from around the zero line are normally very bullish. Likewise, downturns from this level are typically very bearish.

MACD tuned to the same cycle has been moving sideways above the level reached in the Q4-Q1 advance. This signifies that the market is in trending mode. This indicator stayed near this level for 3 months before the market topped out. I wouldn’t get bearish until this turns down and price breaks support.   

Again, this is for the perspective of one day only. The purpose of these reports is not to divine the longer term. If you want longer horizons, I cover that in the Technical Trader service at Lee Adler’s Liquidity Trader. 

Hourly ES S&P 500 Futures Chart

I can repeat what I wrote yesterday. The hourly chart is a mess, with the price moves not coloring within the lines. I’m beginning to wonder if there’s any point to drawing trend channels. As for outright levels, prior pivots seem to generate one bounce or retracement. Then they break.

It’s all noise all the time until they break out of the 2825-2945 range, or more narrowly, 2825-2895.

There’s no 3 or 5 day cycle upside projection yet.

ES Futures Hourly Chart

Momentum, True Strength, and MACD tuned to a 5 day cycle are slightly bullish, but they’ve been wiggling like earthworms as both amplitude and frequency have increased to the point that a typical swing is complete in less than 24 hours.

If that pattern persists, which is by no means assured, then we should be near a peak now. An hourly close below 2864 would suggest that the next downswing had begun. They’d need to break 2855 to really get the ball rolling downhill.

Reminder- I’m only talking patterns for a day here. This is not the big picture. If you want that story, you must subscribe. Risk free trial and all.

Join me on the Capitalstool.com message board today and I will update you there occasionally during the day. Feel free to join the “fun.”

Meanwhile, here are the latest reports from Lee Adler’s Liquidity Trader. 

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Technical Trader subscribers, click here to download the report.

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Lee Adler

I’ve been publishing The Wall Street Examiner and its predecessor since October 2000. I also publish LiquidityTrader.com, and was lead analyst for Sure Money Investor, of blessed memory. I developed David Stockman's Contra Corner for Mr. Stockman. I’ve had a wide variety of finance related jobs since 1972, including a stint on Wall Street in both sales, analytical, and trading capacities. Prior to starting the Wall Street Examiner I was a commercial real estate appraiser in Florida for 15 years. I was considered an expert in the analysis of failed properties that ended up in the hands of bank REO divisions, the FDIC, and the RTC. Remember those guys? I also worked in the residential mortgage and real estate businesses in parts of the 1970s and 80s. I have been charting stocks and markets and doing analytical work since I was a teenager. I'm not some Ivory Tower academic, Wall Street guy. My perspective comes from having my boots on the ground and in the trenches, as a real estate broker, mortgage broker, trader, account rep, and analyst. I've watched most of the games these Wall Street wiseguys play from right up close. I know the drill from my 55 years of paying attention. And I'm happy to share that experience with you, right here. 

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