06-26-2015

Index markets open higher and sell off as Greece talks keep bouncing between resolution and failure, while the European stocks are mimicking the uncertainty as investors await transparency. Neil Mellor, a strategist in London, believes a deal is not certain, but progress has been made this week. This all follows a hard rally earlier this week when investors were more optimistic about the possibility of resolution, of coming to a deal, with the Greek Government and its European Creditors. Stocks started to slowly rise higher early Thursday, optimistic by “upbeat economic data”, but this all turned around just after 2:00pm when the S&P 500 futures dropped down to 2092 followed by a small bounce back to the 2094 area, and back up to the 2099 level early this morning. For the most part the ES had a hard time rallying more than 2 or 3 points (handles) off any new lows throughout the decline.

What bothers me about the Greek bail out, and “stretching” out the negotiations into the weekend, is how utterly stupid this has become. I have seen a lot in my nearly 40 years in the markets, but I can’t remember anything so important being so mishandled. The countries trying to save Greece from defaulting are not just trying to get their money back, but instead of admitting they were wrong to lend the money and just take the hit, they are trying to extend an agreement that will last only 6 to 9 months. Default today, in a week, in a month, 6 months, or a year, it is going to happen. Right now the negotiations are stuck over pension cuts and other aid conditions. If there is no deal, Greece is set to default on June 30.

In the end, the Dow futures (YMU15:CBT) fell 71 points, or -0.42%, to 17812.00. The S&P500 (ESU15:CME) futures dropped 5.50 points, or -0.30%, to 2093.90 and the Nasdaq futures (NQU15:CME) lost 6.50 points, or -0.20%, to 4,509.25. Again, the trade is exactly like the PitBull says “The S&P futures move around like water in the bathtub, push the water up into the buy stops and push the water the other way into the sell stops.” It seems to be a never ending grind.

The clock is ticking down on Greece and its creditors. They are, as the title of today’s Opening Print says; are burning the midnight oil but that oil is burning low.

In Asia 8 out of 11 markets closed lower, and in Europe 11 out of 12 markets are trading lower this morning. Today’s economic calendar includes: Consumer sentiment and Esther George speaking.

View: I will recheck my work, but I think the S&P futures have closed plus or minus 10 to 12 handles of S&P futures 2100.00 11 out of the last 13 weeks. its hard to believe low volatility has been, and how low it remains. It is the one thing traders worry about everyday. I know when you read this you keep thinking that on one of these sell offs, the ES is going to keep going, and I do not disagree, there is some downside potential but ultimately I still think the S&P is going higher.. Our view, sell the rallies and buy weakness. Its Friday and there are buy stops and sell stops to run.

Lastly, this is the last day to sign up for the “summer” deal for the MrTopStep trading room. If you want to talk to me about it just email me at danny@mrtopstep.com.

MrTopStep BootCamp Summer offers end Today!!!

  • In Asia 8 of 11 markets closed lower: Shanghai Comp. -7.40%, Hang Seng -1.78%, Nikkei -0.31%
  • In Europe 11 out of 12 markets are trading lower: DAX -0.41%, FTSE -0.94%, MICEX 0.48% , GD.AT -0.34% at 7:00 am CT
  • Fair Value: S&P -8.04, Dow -94.91, Nasdaq -8.53
  • Total Volume: 1.2 mill ESU and 1k SPU traded
  • Economic calendar: Consumer sentiment and Esther George speaks.

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