Market Review
Globex
| (ESH20:CME) GLOBEX Session | (ESH20:CME) Day Session |
| High 3231.25 | Opening Print: 3212.75 |
| Low: 3189.75 | High 3221.00 |
| Volume: 430,000 | Low: 3175.00 |
| ES Settlement: 3186.00, down 19.5 handles or -0.61% | |
| Total Volume: 1.75M |
S&P 500; Rotation, Rotation, Rotation
We always talk about the S&P 500 futures (ESM20:CME) but there is a new, well not so new, ‘big dog’ in town and it’s called the Nasdaq futures, the (NQM:CME). Years ago when I ran the big S&P futures desk people were ‘addicted’ to trading the S&Ps but in 1998 to 2000 millions were being made in the CMEs Nasdaq futures pit. It was a small group of order fillers and locals that were given ‘huge’ edges to take the other side of a buy or sell order. There were even some order fillers that went to jail. I always knew the desk NQ orders were getting front run but I never knew how much money was made by such a small pit.
Yesterday the ES was 3212.75 on the 8:30 CT futures open. The ES upticked then got hit by several rounds of sell programs pushing the futures all the way down to 3179.75 at 9:44 AM CT. After the low, the ES traded up to 3205.50 and then pulled back down to a higher low of 3186. The next move was a 34 handle rally up to 3121.75 at 1:22, then it rallied up to 3210.25 and then PUKED down to another higher low of 3287.50. The ES rallied back up to 3198.25 at 2:00, sold back off down to 3185.25 at 2:02, traded 3210.75 at 2:30 and then traded 3196.25 on the 2:50 cash imbalance as the MiM showed 129 million to sell. On the 3:00 cash close, the ES traded 3180.75 and then settled at 3186 on the 3:15 futures close, down 19.50 handle or -0.61% on the day.
In terms of the ES’s overall tone, plain and simple, it’s tired but there also has been non-stop rotations. In terms of the day’s overall trade, volume was steady at 1.75 Million ES traded with 430k coming from Globex making total day session volume 1.32 million.
Economic Calendar
Closing Prices
In the Tradechat Room
MiM
Nothing much to say about the MIM as the MIM had nothing really to say with a 15:50 reveal of just 128M to sell. Pretty much 50/50 which is to say whatever and how you were trading, the MOC was not going to be a factor in the softish close.
Reminder: June is Russell 2000 reconstitution month. Here is the schedule for that:
- Friday, May 8 – “rank day” – Russell US Index membership eligibility for 2020 reconstitution determined from constituent market capitalization at market close.
- Friday, May 22 – “query period” begins – preliminary shares & free-float information for Russell 3000 Index constituents are published daily & queries welcomes (query period runs through June 12)
- June 5 – preliminary US index add & delete lists posted to the FTSE Russell website after 6 PM US eastern time.
- June 12 & 19 – US index add & delete lists (reflecting any updates) posted to the FTSE Russell website after 6 PM US eastern time.
- June 15 – “lockdown” period begins – US index adds & delete lists are considered final
- June 26 – Russell Reconstitution is final after the close of the US equity markets.
- June 29 – equity markets open with the newly reconstituted Russell US Indexes.
Questions? Please email me: Marlin@mrtopstep.com
Get the skinny when we get it: Join the MiM.
Chart of the Day
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Our View
TECH BUBBLE REVISED
While 1987 ‘seems’ like it was a very long time ago, the 2000 tech bubble doesn’t. I remember in the summer of 1999 the NASDAQ Composite went up almost every day. Remember the tech stock day trading rooms and how any stupid story behind almost any company would have the price of the companies soaring. I knew before that the NASDAQ was reaching ‘bubble’ levels and we told the desk customers. Yet they kept buying and the NASDAQ kept soaring. Some people say the actual tech bubble started in 1995 but between 1995 and the March 2000 Nasdaq ‘peak’ the index rose 400% only to fall 78% from its ‘peak’ by October of 2002. As the Nasdaq crashed several big online companies like Webvan, Boo.com and Pets.com, several big communications companies like Worldcom, Global Crossings and NorthPoint, went out of business as well. The main reason for the crash was too many investors piling into companies that had terrible valuations, a big overhead, and no cash. And as for those ‘tech stock day trading rooms’ well… those kids made a lot of cash buying no-name companies and within a few months, most of them were gone forever.
Fed Making The Difference
I started out yesterday down and ended up having a great day. I was in my groove trading the range. I want to explain something. Yes I talk to the PitBull a lot. And yes he sees way more than I do and he’s a hell of a lot brighter than I am but I do not base my calls on his opinions. On Monday he was long and on Monday morning I said the next 50 to 60 handle from 3210 was down. It’s 6:33 CT and the ES just made a low of 3151.50 and is trading 3153.00, down 31 handles or down -1%. I know I waved when the ES jumped Monday afternoon and into Tuesday’s OP but I never gave up my call. I rarely pat myself on the back but I have called the last two 50 to 60 handle pullbacks while keeping a long bias. Clearly money is moving into tech stocks and it’s fully backed by the PPT and the Fed.
New Highs TECH : AMZN traded up to a new high at 2,690.00 and closed up $46.59, up 1.79% and up a whopping 42.30% YTD. MSFT traded up to a new all-time high at 198.54 and closed at 195.55, up 5.70, up 3% on the day and up +24% YTD. AAPL traded up to a new all-time high at 351.10 and closed up 8.97 or up 2.61% on the day and up 20.14% YTD. NVDA made a new all-time high at 380.00, and closed the day at 375.00, up $13.31 or up 3.68% and up a smokin’ 59.37% YTD. FB made a new all-time high 241.19 and closed at 236.69, down 2.14% or up 15.32% YTD. And lastly, my dark horse; TSLA made ‘another’ new all-time high at 1,027.48, and closed at 1009.51 up 84.38 or +8.97% on the day and up 141.32% YTD.
Our view, While I think the markets are exhausted I do not want to get overly excited about the downside. What I am looking for is the PitBull’s Thursday / Friday low the week before the June quad witching. Our lean, ideally I think we can rally a bit but the question is will the ES hold? My answer is yes it will if the Nasdaq holds and no it won’t if it doesn’t. You can take it from there. And lastly, if it doesn’t hold, it could be a quick trip down to 3120.
Danny Riley is a 39-year veteran of the CME trading floor. He has helped run one of the largest S&P desks on the floor of the CME Group since 1985.
Market Vitals Technical Analysis
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As always, please use protective buy and sell stops when trading futures and options.
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