$1.7 trillion chip giant Nvidia just gained over $100 billion in value after a blowout quarterst

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Our View

You could tell the ES and NQ acted oversold early in the day. The main weakness came from the NQ that seems to have a good read on the Feds upcoming comments. The ES did have a nice Fed headline drop but the volume was so low that the ES literally went from a big sell program and running stops right back into a short covering buy program that added some late day gamma buying. It was going to be a volatile final 3 hours and it was also another Wednesday low. My guess is this rally should set up another move up into FRYday’s options expiration. Its 10:45 PM and the ES made a high of 5036.00, that’s 91 points off the 4959.00 day session low in less than 5 hours. Another thing, the DAX closed at an all time historical high. Like it or not, the ES did exactly what it does on every selloff, it sucked in more shorts.

Our Lean

Today we have 3 economic releases and 5 Fed governors speaking. It could be another volatile day. After such a fast move up, it’s our guess we will see some type of pull back at some point this morning. NVDA has rallied $100.00? $100? How much further can it go? Our lean is to sell the early rallies / gap up open and buy the pull backs which could be +30 points.

MiM and Daily Recap

The ES traded down to 4974.00 on Globex and opened Wednesday’s regular session at 4978.00. As expected, the ES started out in slow motion. After the open, the ES traded up to 4980.75 at 9:41 and sold off down to 4973.00 at 9:48 when I posted this:

IMPRO : Dboy : (9:59:47 AM) : not saying it will happen just pointing it out, Wedensdays have been the new Thursdays low day
IMPRO : Dboy : (10:02:24 AM) : all I know it’s its too quiet to short and rallied up to 4984.75 at 10:05
IMPRO : Dboy : (11:34:40 AM) : zero selling here.

It traded down to 4974.50 at 10:33, chopped in a narrow back and fill, and then shot up to a new daily high at 4987.00 at 11:15. From there, the ES dropped down to 4987.75, rallied up to a lower high at4985.25 at 12:01, dropped from 4982.25 down to 4970.00 at 12:45, rallied up to 4980.25, and then dropped down to a new low at 4967.75 at 1:03. After the low, the ES rallied back up 4981.50 at 1:20 and for the next 40 minutes it traded in a narrow back and fill just above and just below the vwap and then sold off down to a higher low at 4971.25 at 2:01 just after the Fed headlines hit the tape. After headlines it blasted up to 4984.75 at 2:04:30 and then fell all the way down to new lows at 4599.00,at 3:22. After the low, the ES rallied up to the 4975.50 level at 3:33, pulled back a few points, and then the ES popped again up to 4984.75 at 3:39, dropped a few points, and then rallied up to 4988.50 at 3:44. The ES traded 4985.75 as the 3:50 cash imbalance showed $163 million to buy and then up to 4998.25 going into the 4:00 cash close. After 4:00, the ES sold off down to 4990.50 at 4:14 and exploded higher at 4:20 after Nvidia posted record revenue up 265% on booming AI business. The ES initially rallied up to 5002.25, tripled topped at 4:20:41, popped up to 5008.50, down ticked, shot up to the high of the day at 4514.25, sold off down to the 4996.25 level at 4:21:03, rallied up to a lower high at 5005.50, dropped down to 4973.25, rallied back up to 4984.75 at 4:22:25, and dropped down to a 4975.00 double bottom at 4:22:50. After the low, the ES rallied back up to 4999.75 at 4:25:37, traded down to 4992.25 at 4:26:24, shot up to the 5010.75 level, and then traded up to a new high at 5020.50 at 4:31:07. After the high, the ES sold off down to the 5008.00 area and then ground its way up to a new daily high at 5023.00 going into the 5:00 futures close and settled at 5017.75, up 0.55%. The NQ closed up 102.75 points or 0.58%, the YM closed down 6 points or -0.02%, the RTY settled at 2001.80, down 0.42%, and bonds closed at 117.84, down 0.40%.

In the end, the ES got oversold and, as always, it took bad news and made good off it and then the NVDA earnings were the icing on the cake. In terms of the ES’s overall tone, the ES and NQ had a strong showing. In terms of the ES’s overall trade, volume was LOW, 189k traded on Globex and 1.143 million traded on the day session for a total of 1.332 million contracts traded.