Market Review
“I change the things I can change I accept the things I can’t”
I wrote that when I was thirteen-years old and now just shy of 5 decades, it’s still my guiding light / principle. It’s been a long four weeks. And the last two days may have taken its toll on a lot of folks. No matter which side of the political pool you swim on, the water has become murky.
I’m not a fan of politics. Just as oil and water, they don’t mix. However, last year was a year of polarization. And my heart goes out to anyone who feels pain.
Yesterday was S1H. It has a high probability of a high in the last hour. And, the Composite Man did not waste any time in taking out the offers up to 11:00 marker.
On January 4th, the Composite Man threw over some supply on 1.9M volume. The past four days have seen a series of lifting supports. And where did price find itself in the closing print? The 3804 handle!
And what did the S1H odds in the PROS and NUMBAHS indicate?
Shape of the day: The first day starts the cycle S1H day. You expect it to be bullish with constant buying pressure. The AM is the high, but the day is loopie loop with odds and probabilities for the last hour high.
Honing: Spill odds down, loupie loop, LAST HOUR odds HIGH
All in your email in box before the opening bell…That’s the power of WB’s clock!
I made a twenty-minute video for my subscribers to the AM TURN that outlines Wednesday’s S4H. Not sure how long I’ll keep it up. If you want to see it, it’s only twenty minutes. In the video I show you how, if you used the timing of WB’s clock, the clock that controls all turns intraday everyday…you could have had a 50, 55 or 60 handle day. That is if you understood the timing of the clock. If you want to see it, here it is:
https://my.demio.com/ref/b4A2mlufvfFad4Ev
Looking Forward Friday, January 8, 2021
We closed out the day on a big volume spike and as I write this Globex is trading around the 3814 handle. The market got what it wanted, the concession perhaps but not a full capitulation from President Donald J Trump. Who knows what the next twelve days have in store?
Whatever the outcome, I don’t think it will move the needle…
Focus today will be the Jobs number. Perhaps some virus concerns. The question is, do the bigger players want to keep lifting offers or just hold it, hold it, hold it up here? Any levels higher are just fib expansions from lower levels.
I give you the best of the old school market technicians, JP Morgan, Herriman, Kearn, and Livermore. The traders of the 1930s. How they may have seen the market. I use the lens of Richard D. Wyckoff Principles and Procedures and through the eyes of WB’s hidden internal clock. The clock that controls all turns intraday every day.
We had a good week this week. Our subscribers have been very lucky with the levels given: -8 points Monday, -8 points Tuesday, 60 points Wednesday, and 8 points Thursday. Total for the week 52 points, that would be $2,600 on 1 lot and $7,800 on 3 lots. That’s due to the volatility that crept back into the market. I’ll be the first to say, it does NOT happen every week. When it does it’s a beautiful thing!
I would love for you to join us. If you have not taken the time, now would be a great time for you to subscribe. After you subscribe drop me an email at trader@wyckoffamtrader.com we’ll set up a time to talk and help you discover how using WB’s clock can give you the gift of timing that you need in your trading life.
Economic Calendar
Closing Prices
In the Tradechat Room
MiM
Much ado about nothing on the MOC yesterday. Balanced buy and sell-side with size indicating some type of rotational close.
Questions? Please email me: Marlin@mrtopstep.com
Get the skinny when we get it: Join the MiM.
Covid Corner:
We will be using Israel as our proxy for a post-vaccinated world. They have aggressively vaccinated almost 20% of their population. It isn’t showing up in the charts yet.
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
GMTT – chart of the day – Sugar(Mar) – Jan 8, 2021
Sugar (MAR)
Sugar tested its Feb 2020 high (which was 16.36) and pulled back a little
We gave in November last year two upside targets 15.90 and a medium-term upside target of 17.70.
The first target is reached and the second target still valid.
The high so far was 16.33.
Short term we get a sell signal below 15.00.
Coffee (MAR)
Our target of Coffee was 127.40 and the next target a move towards 134.00.
The high was 129.40 on Jan 4, but we did not quite see the next target yet.
Coffee is now trading near our sell stop of 119.00 but the stop is not yet hit.
However, only a good close below 119.00 by todays end of trading day cancels the buy signal.
GMTT publishes three weekly its GMTT research report covering the following:
Global Indices, VIX, a selection of stocks, Treasury Bond, Commodities, Soft Commodities, Currencies, and Bitcoin.
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GLOBEX
| (ESH20:CME) GLOBEX Session | (ESH20:CME) Day Session |
| High 3734.75 | Opening Print: 3702.00 |
| Low: 3685.50 | High 3774.75 |
| Volume: 190,000 | Low: 3695.75 |
| ES Settlement 3745.25 | |
| Total Volume2.0M |
S&P 500 Futures Recap – Trade Date January 7, 2021
Was 3800 Ever In Doubt?
After trading in a 31.25 handle overnight range, the S&P 500 futures opened Thursday’s cash session at 3765.75, then traded the daily low of 3663.75 in the initial minutes before heavy buy programs came in pushing the index futures higher throughout the early morning up to 3803.25 just after 10:00. From there, the futures would trade sideways for the rest of the morning, the noon hour, and early afternoon. The index printed the daily high of 3804.00 just before settling at 3797.25, up 81.50 handles or +2.18% on volume of 1.2 million. In terms of price action, it was all about buying the open and holding into the late-day high.
Our View
Record Covid19 Cases And Job Loss
Our view
The US is breaking records. As the stock market continues to make new highs there is some other record-breaking news, Covid19. Yesterday, at least 4,111 new coronavirus deaths and 280,028 new cases were reported in the United States. Over the past week, there has been an average of 237,607 cases per day, an increase of 15 per cent from the average two weeks earlier. As of Friday morning, more than 21,689,400 people in the United States have been infected with the coronavirus. The surge in cases is expected to impact today’s December jobs report this morning. According to Dow Jones, economists expect 50,000 jobs added in December, slightly more than a fifth of the 245,000 in November. The unemployment rate is expected to rise slightly to 6.8% from 6.7%. Clearly, the record level of covid19 cases isn’t impacting the record-breaking run in the S&P 500 that made another new record high yesterday.
I traded well Monday and Tuesday but terribly Wednesday and Thursday. Why? The answer is simple, I forgot a few things. The first is to buy any news related pullbacks and the second part is not to forget that as long as the government is handing out money stocks are going up.
Our view, one of my favorite trades is to sell the gap-up opens or the first rally above the gap. That trade paid off handsomely last year but it also tends to throw off my ‘buying the pullbacks’ trade. Instead of being patient and buying the mid-morning dip, I’m looking to cover the short and go long. That’s not always easy especially if the sale on the open doesn’t dip enough or markets rally right out of the gate. Our lean, in most cases our rule is to fade a big gap up or down on volume of 300k contracts traded on jobs Friday. That said I’m going to go very slow. When you start losing it’s always better to go back to being a spectator until you get your feel back.
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.
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. Decisions 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.
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