GLOBEX
| (ESH20:CME) GLOBEX Session | (ESH20:CME) Day Session |
| High 3418.25 | Opening Print: 3404.25 |
| Low: 3385.25 | High 3419.50 |
| Volume: 363,000 | Low: 3373.75 |
| ES Settlement 3379.00 | |
| Total Volume 1.76 M |
S&P 500 RECAP – Trade Date 09/16/ 2020
S&P 500 Futures: Failed to Hold the FOMC Bid, Closed Lower
After trading sideways to higher in the overnight hours the S&P 500 futures opened yesterday’s cash session at 3404.25, up 9.25 handles and stayed in that range for the first hour, making an early morning high of 3406.75. Just after 9:30 the index would make its way to the morning low of 3392.00 before buyers would come in and push the futures up to 3412.50 at 10:30 for what would amount to the morning high. Late in the morning the S&P’s tracked lower, making a midday low of 3393.00.
The afternoon saw the FOMC announcement which initially led to a buy, pushing the ES up to a 3419.50 high of day just after 1:30, and then reversed, selling off for the rest of the day down to 3373.75, a 45.75 handle reversal in less than 90 minutes.
The index would settle the day at 3379.00, down 16.00 handles or -.44%. In terms of volume, it was another strong day with 1.76 million contracts traded. As far as price action, buyers of the early morning and midday lows were rewarded, but the largest prize came to those who faded the FOMC rally.
Economic Calendar
Closing Prices
In the Tradechat Room
MiM
A decent buy imbalance with 1.2B to buy but the symbol % was actually negative. The buy MOC at 15:50 gave the selling market a boost up that set up a perfect sell into the close.
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Covid Corner:
India is taking over the lead role form the USA, which mathematically makes sense. Currently adding about 100K cases a day with little slowing. We could see 200K a day by the end of the year from this giant country. Currently, the United States adds about 1K deaths a day, India about the same amount on 3x more cases per day. That will change. India is in a tough spot and is going to need help.
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!
Chart of the Day
OUR VIEW:
Goldman Sachs ‘Reopening of America Index’
Yesterday, David Kostin, Goldman Sachs chief U.S. equity strategist, said that ‘the future outlook is fairly optimistic and that growth stocks are where investors should be focused.’ Look at the Super Forecasters ‘Good Judgment Project’ (GJP) that says there is a 70% probability of a vaccine mass-distributed by the end of the first quarter of 2021. This is a good backdrop for economic growth forecast for 2021 by GS Economic at around 6% average annual growth next year with a consensus of less than 4% which gives some room for upside expectations. Kostin went on to say that GS has a ‘Reopening of America Index’ that is now reading 5 and that if you want to think about 1 as lockdown and 10 as normal back in February, the economy is halfway back. And you look at some of the earnings expectations for 2021, around $170.00 of earnings with a consensus of $165.00 so there is upside margin there. And an interesting thing is people are focusing on 2022 which is partly a rationalization due to the rise in the share prices that GS is looking at $188.00 for 2022 so a couple of years of pretty strong recovery and that positioning is pretty modest, not fully stretched like it was in late February. So those are some of the reasons that give us some optimism on what’s taking place and one of the arguments in favor of continuing to buy growth stocks, particularly in the technology area. This is probably a big area of discussion with clients of Goldman Sachs. By extension, if we do get a vaccine, and most people on the buy-side seem to be anticipating there will be the identification of what the vaccine could be some time in October and FDA approval by the end of the year, that’s pretty positive and what investors are expecting and goes right along with my S&P 3600 call for year-end.
PitBull Thursday / Friday Low Before The September Quad Witching RIP
Our view, the #ES could be headed for lower prices today but we don’t think the decline will last going into Friday’s ‘September Quad Witch’ quarterly options expiration. Like I have said many times, you can get one down day, maybe two, but three-day declines are hard to find. Our lean is to look for some type of early ‘pop’ to sell then buy the pullbacks.
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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