S&P 500 Futures Recap – Trade Date December 23, 2020
After trading in a 49.75 handle overnight range, the S&P 500 futures opened Wednesday’s cash session at 3688.25, up 12.00 handles, traded a morning high of 3697.50 and then sold to a morning low of 3688.25 all before 9:30 ct. The rest of the morning would maintain the first hour range until the buyers pushed the ES up to 3701.25 at 12:30.
From there the rally would stall out, and sellers would own the afternoon with the S&Ps pushing down to 3674.50 in the final minutes before settling at 3678.00, up three ticks on the day. In terms of price action, it was all about buying the 9:30 low and then fading the 12:30 high. Volume was light having just missed a million contracts traded.
In the Tradechat Room
Nice selling MOC at 15:50 sent the markets lower. The S&P components in the MOC were over 75% to the sell-side. That was a solid exit number for the MOC.
A net of plus one rising states as Arizona, Louisiana, and Georgia join the rising group and Oklahoma and Hawaii move from rising to stable. Falling states dropped by 4.
Wear your masks! Stay at least 10 feet behind someone wearing a mask! (Particularly in a checkout line) Stay home! Take your Vitamin D!
Chart of The Day
Pardons And Vetoes For Christmas
President Trump is pardoning friends and using his veto powers. He blocked the military bill and is upset with all the ‘pork’ in the new stimulus bill and wants to increase the stimulus payouts to Americans. What’s wrong with that? Nothing, really, but a rework of the bill could delay the release of the very badly needed money needed going into the holidays. The first thing that comes to mind when so many people in the US are hurting why not make it more friendly for the people that need it most? The bill extends aid to millions of struggling households through stimulus checks, enhanced federal unemployment benefits, and money for small businesses, schools and child care, and vaccine distribution. It also repurposes $429 billion in unused funding provided by the Cares Act for emergency lending programs run by the Federal Reserve. The other big question, will Trump actually veto the bill? I do not know the answer to that question.
Our view, the ES got hit by the late day headline that pushed the futures down to 3665.75 and on Globex traded up to 3694.50 just after 3 am this morning and are trading 3689.00 as I write this. I have chopped myself up a bit trying to trade the low volume chop. I personally don’t think Trump is done with his holiday shenanigans. Our lean, the #ES, #NQ, #YM, and #RTY are only open for half a day and closed on Friday for Christmas. ES Globex volume is only 70k at 7:20 ET. Our lean is to take my own advice, kick back and cut back. If the ES dumps maybe I’ll try a long play but after yesterday’s late mess I think it’s best to just stay out. If the ES does firm up I still see buy stops above 3698.50 up to 3706 and again above 3709 up to 3718.
I want to wish everyone a very ‘Merry Christmas’. I know it’s tough for a lot of folks not being able to see other family members, but I really believe that things are going to get better over the next 3 to 4 months. All we can do is hope and pray for better days.
Danny Riley is a 39-year veteran of the CME trading floor. He ran one of the largest S&P desks on the floor of the CME Group since 1985.
As always, please use protective buy and sell stops when trading futures and options.
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