Market Review
May you live in interesting times. Is it a Chinese blessing or a Chinese curse?
When I was a kid, often I was told to eat ALL my food, children in China were starving. And if I was digging a hole in the backyard, I’d have to be careful else I’d be digging into China? Who would have thought China would dig a hole into the United States? Into the inner circle of Silicon Valley Big Tech? Into Politics? Cities and Mayors? And maybe into congressmen and all the way up to into highest office of power…
I followed the China Virus since January 12 when four people died and folks were fleeing the Asian lands. The market fell, and then short months later it started a leg. All the while I wear a mask made in China. And as I write this, I still wear. And may wear one for a hundred days or more. And talk is, some states may start to mandate the vaccine?
The market has an intrinsic bid. The hope of a stimulus bill is like a carrot on a stick. News of a vaccine will rally the market. The realization of death counts will sell it off… And still, we wait. Who won the election?
Franklin Graham tweet: (I was never a fan of Franklin, but he was “Billy’s” Son)
It is alleged that Communist dictator Joseph Stalin made the statement, “Those who cast the votes decide nothing. Those who count the votes decide everything.” Whether Stalin is the one who said this or not, the statement is true, & this is a huge issue facing our country today.
Yesterday the market was bid from the git-go. I had S1H day. The odds were spill down with the potential for high later in the day. The spill sealed 3644 handle within the first five minutes. And if you were short the market you were able to hold it around that 3675 level. I gave my subscribers the 3675 level as a potential short and 3649 down to 3643 to get long. Both could have been held longer but you do not know the outcome of a random event.
The question on trader’s minds is, is this a resting spell for further downside action or was Wednesday’s volume the selling climax? There is a high probability that Wednesday, actions could be preliminary support with the selling climax to find.
If you knew WB, And you knew what an S4H day was. It was his favorite, he called it “Debbie Day”. A nurse he favored would often be in chat. It was her day. She played the “Wedge Zoom” Well Wednesday was no Wedge Zoom it was a Link a stick. If you want to know more, I made you a video. Click below to view it.
Looking Forward Friday, December 11, 2020
Most traders have left the Dec’s and moved on to the March contract. Volume for the Dec’s was 1,572,715 lots. March 503,283 volume. Today, March will be the focus.
It’s a Friday. Politics, Stimulus, and the Virus are the carrots. That’s been the catalyst since May. The weekly pivot is 3661 handle. Not many traders look at the weekly pivot. Well, as I write this we are trading 3647 handle.
Bulls need the weekly pivot for the bragging rights. The next ideal is to hold open of 3645 handle. At these levels, we are looking at a spring at best of the previous day’s low.
After regaining the weekly pivot the 3675 is a good level to recover then on to the big even 3700 handle.
That is if you live in a myopic bullish world. For the bears, taking out the 3640 is paramount and then why not just add insult to injury at go for the 3625 on down to the 3600 big even.
That could happen if Globex bulls drop the soap and it’s the bear’s ball at the opening print. We still need a catalyst. And some unexpected news or ANYONE’s tweet could add just that!
I give you the best of the old school market technicians, JP Morgan, Herriman, Kearn, and Livermore. The traders of the 1930s. How they may have seen the market. I use the lens of Richard D. Wyckoff Principles and Procedures and through the eyes of WB’s hidden internal clock. The clock that controls all turns intraday every day.
We had a good week this week. Our subscribers have been very lucky with the levels given: 6 points Monday, 7 points Tuesday, 9 points Wednesday, and 26 points Thursday. Total for the week 48 points, that would be $2,400 on 1 lot and $7,200 on 3 lots. That’s due to the volatility that crept back into the market. I’ll be the first to say, it does NOT happen every week. When it does it’s a beautiful thing!
I would love for you to join us. If you have not taken the time, now would be a great time for you to subscribe.
Economic Calendar
Closing Prices
In the Tradechat Room
MiM
The 15:50 MOC was neutral, with a slight lean on the symbol % to buy and up we rode to 3674.75. As as we have seen lately.as the 15:55 candle was a counter trade which kicked in right at 15:55 and down we rode into the close for 10 points.
Questions? Please email me: Marlin@mrtopstep.com
Get the skinny when we get it: Join the MiM.
Covid Corner:
Today we continue our look for the Thanksgiving surge. It is a chance to extract real behaviour-based data from the stats. So far we have found the only real behaviour evidence was the lack of data and work during the 4-day weekend. I have moved back to a 7-day average and changed our vertical axis to log-based. With an increase in cases, we should see an upward change of slope.
Looking at our best scoring state, Minnesota, we see a continual down trend with no Thankgiving surge.
We will revisit these two benchmark states next week to see if we can find any real trends that are data-collection independent.
Wear your masks!
Stay home!
Take your Vitamin D!
GLOBEX
| (ESH20:CME) GLOBEX Session | (ESH20:CME) Day Session |
| High 3681.25 | Opening Print: 3653.50 |
| Low: 3650.25 | High 3678.50 |
| Volume: 180,000 | Low: 3644.00 |
| ES Settlement 3701.25 | |
| Total Volume 1.5 M |
S&P 500 Futures:
After trading in a 31.00 handle overnight range, the S&P 500 futures opening Thursday’s cash session at 3653.50, down 19.00 handles, traded to a daily low of 3644.00 in the opening minutes before rallying to 3678.50 for the daily high just before 10:30. The remainder of the day would stay inside that range in what amounted to a sideways chop.
The S&Ps settled at 3663.00, down 9.50 handles or -0.25% on total volume at 1.5 million. In terms of price action, it was all about buying the early morning low and profit-taking at the midmorning high.
Our View
DoorDash Worth $100 Billion
The sheer numbers of this week’s IPOs are almost too hard to believe. As of yesterday’s close, Doordash’s $100 billion value is more than Hyatt Hotel Corp, Marriott International, and Hilton Worldwide Holdings Inc. combined. My question is, how is it possible that 3 of the world’s largest hotel chains are worth less than a food delivery company? According to Datalogic so far in 2020, more than $155 billion has been raised for IPOs on U.S. exchanges, far exceeding the previous full-year record set at the height of the dot-com boom in 1999. To me this sounds like a catastrophe waiting to happen and not sustainable but what do I know.
Our view, after it was all said and done yesterday the Dow closed down 0.24%, the S&P closed down 0.13%, and the Nasdaq closed up 0.43% … it’s all about the rotation’ Our lean, I can’t put my finger on it but the overall price action is weak. Investors had to sell stock in order to buy the IPO’s and it seems like it’s capping the ES. Our lean, if the ES gaps lower I would look to buy the open but ideally, I want to get an eye on the price action. The ES has run a lot of buy stops, it may be time for some downside stop runs.
Danny Riley is a 39-year veteran of the CME trading floor. He ran one of the largest S&P desks on the floor of the CME Group since 1985.
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. Decisions 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.
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