Early Rally Fizzles Out As IBM Red Hat Deal Targets Cloud Giants Amazon, Microsoft, Google

Index Futures Net Changes and Settlements:

Foreign Markets, Fair Value and Volume:

• In Asia 9 out of 11 markets closed higher: Shanghai Comp +1.02%, Hang Seng -0.91%, Nikkei +1.45%
• In Europe 10 out of 13 markets are trading lower: CAC -0.34%, DAX -0.38%, FTSE +0.12%
• Fair Value: S&P -0.19, NASDAQ +7.27, Dow -33.14
• Total Volume: +2.76mil ESZ & 508 SPZ traded in the pit

Today’s Economic Calendar:

Today’s economic calendar includes Redbook 8:55 AM ET, S&P Corelogic Case-Shiller HPI 9:00 AM ET, Consumer Confidence 10:00 AM ET, and Farm Prices 3:00 PM ET.

S&P 500 Futures: Sell The Rallies Till It Hurts

_{Chart courtesy of @Chicagostock – $ES_F What would be the biggest screw job on Tuesday? To rally back and squeeze shorts through Monday’s 2707 after shaking out “early” longs below Friday’s 2627 low. Doing so needed to confirm failed b/o < 2630. Sellers must defend rallies.}

After rallying in the overnight session to open higher, the S&P 500 futures printed 2692.25 on Mondays 8:30 AM bell, and chopped in a tight range to an early morning low of 2687.00 just before 9:00. From there, 9:00 buy programs took the ES up to 2707.00, leaving buyers stranded at the early high of day. The ES began to change course through the end of the first hour, trading down to a 2682.50 mid morning low, and after a late morning bounce to 2694.25, the futures then turned lower down to 2666.25 at 11:20, before rallying into the afternoon.

The rally would reach up to 2683.00 early in the afternoon, but then began to chop lower until strong sell programs hit at 1:00, pulling the S&P futures down to a 2647.00 low entering into the final hour. After that, the ES continued to sell, as the MiM was showing sells across all S&P 500 sectors. The ES bottomed out late in the day at 2603.00, and then rallied into the close, printing 2642.50 at 3:00 CT after a massive 40 handle rally in the final 15 minutes, and settling the day at 2643.00, down -26.50 handles, or -0.99%.

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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.}