on April 12, 2024

Geopolitical Tensions Create Weekend Risk

Earnings start today with the banks

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Our View

I didn’t fully think out the Lean yesterday, as I forgot the PitBull’s Thursday / Friday low in front of next week’s monthly expiration.

This is only a few posts from the chat and despite me saying sell the rallies earlier in the day, I was quick to notice that the selling had dried up. I made money but I didn’t trade it well — too bad. As a trader, being open-minded and flexible is really important. You can’t get stubborn and for the sake of wanting to be right.

IMPRO : Dboy : (10:30:45 AM) : at some point today the ES will trade 5230. long 4 NQ 09.5 and paid 5188.00 on 6 ES
IMPRO : Dboy : (10:31:40 AM) : not a bull on 10k miles
MPRO : Dboy : (11:04:37 AM) : give me odds and I bet we see 5230 today
IMPRO : Dboy : (12:00:32 PM) : but every, Tom, Dick & Harry was saying down
IMPRO : Dboy : (12:00:49 PM) : The PitBull’s Thursday low is in

We saw 5230…and eventually, took out 5250!

Our Lean

There are two main questions.

Was yesterday a dead-cat bounce?
Will there be options gamma to the buy side today?

My feeling is we start to go back up and what the ES and NQ need to do is pull back and give us some good old back-and-fill. That said, there are no economic reports and only Chicago Fed President Austan Goolsbee speaks at 10:30. I can’t remember more Fed speak and headlines in a long time.

Our lean is you can sell the early rallies and buy the deeper pullbacks. I don’t want to say the markets can’t bounce, but things have changed in the last few hours (see update below)

By the way, my levels I posted were only a few points off the low and 1 point off the high.

I want to thank all of you and I also want to offer any premium Opening Print customers a free 2-week trial in the chat. Even if you can’t be in there all the time I still think it’s something to see. Email me at danny@mrtopstep.com is you are interested.

Update: US officials told CBS News that a major Iranian attack against Israel was expected as soon as today… It could be tonight or tomorrow. The attack possibly includes more than 100 drones and dozens of missiles aimed at military targets inside the country and CEO Jamie Dimon warned investors that trouble could lie ahead.

“Many economic indicators continue to be favorable. However, looking ahead, we remain alert to a number of significant uncertain forces,” he wrote in a press release Friday. “First, the global landscape is unsettling — terrible wars and violence continue to cause suffering, and geopolitical tensions are growing. Second, there seems to be a large number of persistent inflationary pressures, which may likely continue. And finally, we have never truly experienced the full effect of quantitative tightening on this scale. We do not know how these factors will play out, but we must prepare the Firm for a wide range of potential environments to ensure that we can consistently be there for clients,” he said.

MrTopStep Levels:

How to use MTS levels

MiM and Daily Recap

The ES rallied up to 5208.00, sold off down to 5178.50 at 8:00 am, traded down to 5173.50 on Globex after the PPI report — a measure of inflation at the wholesale level —showed an increased of 0.2% for the month, less than the 0.3% consensus estimate, and then rallied up to 5222.50 and opened Thursday’s regular session at 4218.75. After the open, the ES traded 4220.50 and then sold off down to 5181.75 at 10:30 and then fell into a stutter-step grind up to 5200.75 at 11:15, pulled back down to 5295.50 at 11:45 and then rallied up to 5216.50 at 12:00.

The ES pulled back to 5210.50, rallied up to a new high at 5217.25 at 12:30, traded 5209.25 and it was that low that set off a push up to 5218.75, then a small pullback followed by a rally to 5233.25 at 1:15, another small pullback and then a rally up to 5241.75 at 1:30. From there, the ES pulled back to 5232.00 at 1:46, made a new high at 5244.00 at 2:00, dropped a few points, pulled back and then rallied up to 5255.50 at 2:15, pulled back to 5249.00 and then traded up to 5257.50 at 2:45. That’s when I posted this:

IMPRO : Dboy : (2:42:30 PM) : next 10 pts in is is down

The ES dropped 10 points down to 5247.50 at 3:00, rallied up to a lower high at 5254.75 and then rallied up to 5256.00 at 3:46. The ES traded 5251.00 as the 3:50 cash imbalance showed $2.1 billion to sell, traded down to 5241.75 and traded 5242.50 on the 4:00 cash close. After 4:00, the ES traded down to 5240.00 at 4:15, traded up to 5245.75 at 4:30, and then down-ticked and traded 5242.25 on the 5:00 futures close, up 35.5 points of +0.068% and the NQ settled at 18,485.50 up 288.75 points or 1.59% on the day.

In the end, it was a little down and a lot up. In terms of the ES’s overall tone, there was a big sell program after the opening, and then a big tech buy program after — the Mag 7 did great yesterday, led by AAPL and NVDA. In terms of the ES’s overall trade, it was firm: 358k traded on Globex and 1.338 million traded on the day session for a total of 1.696 million contracts traded.