MrTopStep Opening Print: For Traders By Traders

Index Futures Net Changes and Settlements:

Foreign Markets, Fair Value and Volume:

• In Asia 7 out of 11 markets closed higher: Shanghai Comp +0.46%, Hang Seng +2.27%, Nikkei -0.43%
• In Europe 12 out of 12 markets are trading higher: CAC +0.92%, DAX +0.68%, FTSE +0.76%
• Fair Value: S&P -1.22, NASDAQ +5.55, Dow -31.98
• Total Volume: 1.4mil ESH & 1.5k SPH traded in the pit

Today’s Economic Calendar:

MBA Mortgage Applications 7:00 AM ET, Consumer Price Index 8:30 AM ET, Retail Sales 8:30 AM ET, Atlanta Fed Business Inflation Expectations 10:00 AM ET, Business Inventories 10:00 AM ET, and the EIA Petroleum Status Report 10:30 AM ET.

S&P 500 Futures: Raising The Debt Ceiling Give The #ES A Boost

Yesterday started out with the Nikkei down 0.7%, and the rest of the Asian markets closing mostly higher. The Stoxx 600 was down -0.30%, the S&P was down -0.70% on Globex, and the yield on the benchmark 10-year note has rose to near 2.9%, its highest level in four years.

In the S&P 500 futures (ESH18:CME), the overnight Globex range was 2636.00 to 2659.25, with 263,000 contracts traded. On the 8:30 CT futures open the ES traded 2640.40. After the bell it traded down to the 2640 area, and after making several higher lows, stutter stepped up to the 2650 area. Once the early push was done, the ES sold off down to 2639.50, and then rallied up to a lower high ar 2650.25.

Most of the day was small drops and pops. After a another higher low at 2639.75 the ES double topped at 2652.75, made another higher low at 2642.50, and then made a lower high at 2651.75. A few hours of ‘back and fill’ ensued between 2642.50 and 2552.00, and then in came a big buy program that pushed the ES all the way up to 2666.50, up 30.50 handles from the Globex low, and up 14 handles on the day.

At 2:00 the MiM started to show over $500 million to sell, and the ES pulled back down to 2657.50 before rallying up to the 2667.50 level as the MiM dropped down to $700 million to sell. The actual MOC came out sell $457 million.

The (MiM) MrTopStep Imbalance Meter

Small closing imbalance yesterday yielded some small change short trades. That 3:45pm reveal had the markets legs cut from the 2667.50 top down to the 2660.00 area, a nice 5 points right there in the middle. We were signaling a small sell that grew to about -600M, but turned out to be -457M on the reveal. The market bounced a bit, but selling again took over the last 10 minutes.

This AM pre-market we see a small upside gap, which needs to build and then explode. All eyes are on the 8:30am CPI number as the inflation worries continue. If you have questions about the MiM, or about becoming a part of the growing community, email me: marlin@mrtopstep.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.}