Less Is More
The S&P 500 futures (ESZ19:CME) settled at 3004.50 Wednesday, about ten points above its opening print of 2994.01, and at the higher end of its trading range (2991.21 – 3004.78).
Holding the 3000 level was important, a reduction of the trading range after testing lows leaves something to be desired.
The following charts from AMS are what we use. We covered our ES short from Tuesday at the lower end of the Bollinger Bands and went long, then closed out the long at the close. We depended upon the “Gold Cell,” the single highest volume cell on the DeltaPrint charts for both transactions.
Like I said before, we take care to minimize what we need look at to decide. Here is proof that what we have programmed into our system works. Feel free to email me at david@amstradinggroup.com if you have any questions. It works for us and will work for you as well once you take the time and effort to learn.
Fed Steps Up Its Game
Assuming you’re following the QE4 updates, then you’re aware of the several articles that have appeared discussing the actions of the New York Fed being forced to add liquidity into the banking system. The Fed is back with a vengeance, and this has nothing to do with what I’ll call “Faux QE4.”
A day after a surge in the Fed’s 4th consecutive T-Bill POMO, dealers submitted bids totalling $44.2 billion for $7.5 billion of T-Bills. These transactions have nothing to do with term-repos or the faux QE4, they are actions comprised of Federal Reserve Management transactions.
The fact that this latest one is the fourth since the announcement of the faux QE4 is important. It was oversubscribed by a factor of 5.9X. If you do not think liquidity is a huge problem, then I have same beachfront property to sell you; it’s only underwater half of the day.
Nat Gas Update
The “widow maker” is marking time today. Storage numbers were uneventful, but we did see an increase in price of the VPOC, something that often precedes a move to the upside.
Again, we have no position, and it is highly unlikely we will initiate one today unless the bottom falls out. I’m here to help you learn, just email me at david@amstradinggroup.com.
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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.
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