Has The ‘Fake’ Bull Rally Hit Resistance

Index Futures Net Changes and Settlements:

Foreign Markets, Fair Value and Volume:

• In Asia 10 out of 11 markets closed lower: Shanghai Comp -4.40%, Hang Seng -1.91%, Nikkei -2.01%
• In Europe 13 out of 13 markets are trading lower: CAC -0.49%, DAX -0.70%, FTSE -0.86%
• Fair Value: S&P +5.28, NASDAQ +31.70, Dow +27.80
• Total Volume: 1.9mil ESH & 4.4k SPH traded in the pit

Today’s Economic Calendar:

Today’s economic calendar includes Employment Situation 8:30 AM ET, Housing Starts 8:30 AM ET, Mary Daly Speaks 10:00 AM ET, the Baker-Hughes Rig Count 1:00 PM ET, and Jerome Powell Speaks 10:00 PM ET.

S&P 500 Futures: #ESM Breaks 2766.31 Simple 200 Day Moving Average

Chart courtesy of Stewart Solaka @Chicagostock – $ES_F Daily retesting 200DMA. This was resistance in Oct-Dec, can it convert into support? Holding above keeps buyers in control, will have to overcome today’s high to trap shorts for next leg into 2880-2920. Stops under 2729, 2680.

There are a lot of unanswered question about the longevity of the S&P 500. After a 10 year rally and over $4 trillion in quantitative easing, some investors are questioning if the ‘fake’ bull market has hit its resistance. This week, the Federal Reserve signaled more reluctance to raise U.S. interest rates this year, and yesterday the European Central Bank announced new stimulus plans. Are the U.S and EU going to end up like Japan? How are the world’s central banks going pay back all the money they owe? It’s a legitimate question that needs a legitimate answer!

During Wednesday nights Globex session, the S&P 500 futures (ESH19:CME) printed a high of 3781.75 around 7:30 am, but dropped 9.25 handles to open Thursday’s regular trading hours at 2772.50. After the open the ES immediately got hit by several sell programs, pulling the market all the way down to 2750.25 at 8:52. After a small pop the ES sold off down to 2747.00, and basically back and filled under the vwap until it rallied up to 2762.00, before then pulling back under the vwap and making a low at 2754.25 just after 11:30 am.

The front month June contract went on to rally up to an afternoon high at 2766.25 at 12:00, and by 2:05 had fallen back down to a new low at 2743.75, down 28 handles on the day. From there, the ES bounced up to 2752.50, then pulled back to a higher low at 2746.75 as the MiM went from over $800 million to sell to $509 million to sell. At 2:45 the ESM traded 2750.50 when the MiM revealed $943 million to sell, then traded 2754.00 on the 3:00 cash close, and settled at 2755.00 on the 3:15 futures close, down -16 handles on the day, or down -0.58%.

In the end, the overall tone of the ES was weak and filled with sell programs and sell stops. In terms of the days overall trade, total volume was extremely low due to the roll over, with only 325,000 June futures contracts traded.

Daily HotSpots

HotSpots are times during the market trading session that for the past XX days have consistently moved in one direction or the other. These HotSpots are published each morning pre-market. The next day, a results post is also published and weekly a summary post.

CAUTION: This data is under development and provided only for research and teaching purposes

If you have questions about HotSpots you can contact us at info@mrtopstep.com.

Get All Of Today’s HotSpots Here

SIGN UP HERE TO GET THE FULL MRTOPSTEP OPENING PRINT!

As always, please use protective buy and sell stops when trading futures and options.

_{Disclaimer: Trading Futures, Options on Futures, and retail off-exchange foreign currency transactions involves substantial risk of loss and is not suitable for all investors. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge, and financial resources. Any decision to purchase or sell as a result of the opinions expressed in the forum will be the full responsibility of the person(s) authorizing such transaction(s). BE ADVISED TO ALWAYS USE PROTECTIVE STOP LOSSES AND ALLOW FOR SLIPPAGE TO MANAGE YOUR TRADE(S) AS AN INVESTOR COULD LOSE ALL OR MORE THAN THEIR INITIAL INVESTMENT. PAST PERFORMANCE IS NOT INDICATIVE OF FUTURE RESULTS.}