Market Review
Last week I wrote “the 50-day MA may now become resistance and hinder any bullish attempt to move above the 3320s.” That is exactly what happened last Wednesday when the ESZ20 topped out at 3319.75 before ultimately selling off to 3200. Today (Monday), the ESZ20 has once again reached the 50-day MA and is struggling to move through.
This week’s scenarios are not much different than last week as the ESZ20 is in a similar situation. If the bulls can clear the 50-day MA, then 3440 becomes the next significant area of technical resistance. To the downside, the 3200 high-volume area remains key and if the bears can clear, then the low 3100s is in sight. Just below 3100 is the ESZ20 200 day moving average, a significant marker for long-term players.
Volatility is elevated with average daily ranges between 75 and 86 ESZ20 points. September as lived up to its reputation as a down month and now we are facing an October in an election year. Both Republicans and Democrats are hiring hundreds of lawyers and assembling thousands more volunteer lawyers in preparation for a potentially contested election. Politics should keep volatility elevated.
Below is a snap of the ESZ20 daily chart with the above support and resistance numbers marked for reference. Thanks again for reading. For more information on how DTG can help your trading, visit us at DiscoveryTradingGroup.com
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MiM
Smallish MOC on Friday with the 15:50 reveal showing about a 1.2B sell which was all paired off five minutes later and had us settling higher from the reveal. A smallish move of just around 7 ES points overall.
Questions? Please email me: Marlin@mrtopstep.com
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Covid Corner:
Five weeks before the US election and we look at some swing states and what is happening in North Carolina? Florida announced full reopening and the bars are packed. Interesting to note that Florida’s schools have been in session since August and we have seen no increase in cases related to that despite much concern. This latest move in full-reopening will be a canary for the rest of the country.
Ohio is holding but not making much progress in reducing their cases.
North Carolina has their back to college special with 3K cases attributed to colleges and universites. Turns out first graders are better behaved then college age kids, but we probably all knew that already.
To use our table, go to https://t2r4.com/cv19/views. Each column is sortable and if you click on a cell you will get a time-based chart of the state.
Wear your masks!
Stay home!
Take your Vitamin D!
Chart of the Day
GLOBEX
| (ESH20:CME) GLOBEX Session | (ESH20:CME) Day Session |
| High 3337.00 | Opening Print: 3333.00 |
| Low: 3287.50 | High 3350.75 |
| Volume: 245,000 | Low: 3321.75 |
| ES Settlement 3346.50 | |
| Total Volume 1.46 M |
S&P 500 RECAP – Trade Date 09/28/ 2020
#ES Money Maker Chart
S&P 500 Futures: First Back-to-Back Higher Closes in 2 Weeks
After trading just shy of a 50 handle overnight range that lead to higher prices, the S&P 500 futures opened Monday’s cash session at 3333.00, up 49.50 handles, and then in the opening half hour traded down to 3321.75, in what would amount to the low of day. From there the S&Ps would rally into what would be the morning high right of 3346.50 at 9:30 and then trade in a range the rest of the morning making higher lows.
Late morning, a buying surge once again added momentum to the equity futures, eventually the ESZ would go on to print a high of day 3350.75 just after 1:30 pm. The rest of the afternoon would amount to a quiet range trade as the index would pull back to 3336.75 late in the day before settling at 3346.50 up 59.25 handles or +1.80%
In terms of price action, it was all about buying the Globex open and holding on. If you missed that, then if you bought the opening low, then that was the spot for the regular hours. Total volume, however, amounted to a modest 1.46 million contracts traded, the lowest since September 1st.
OUR VIEW:
Trump And Biden To Square Tonight In Debate
The ES reader up to 3363 and sold off down to 3332 on Globex and are unchanged this morning. Despite the push higher, the VIX remained elevated at 26.67. Base metals, energy, and the grain markets are all lower as are most European stock markets. They say this morning the democrats and republicans are ‘again’ going to try to seal a deal on a new stimulus program today but the odds remain low. Global Covid19 cases have reached 33 million. Tonight is the first of three presidential debates. There is so much news and so many moving parts it’s hard to keep up.
Our view, the ES has rallied sharply over the last two sessions yet the VIX remains elevated. Our lean is to sell the early rallies and buy the pullbacks with tight stops. The stats are weak going into the end of the month and the first trading day of October.
Market Vitals Technical Analysis
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As always, please use protective buy and sell stops when trading futures and options.
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