Market Review
E Zones update
All eyes on the unemployment claims today. We saw a reversal of the 2560s yesterday for a quick move to the 2400s into Globex.
For today we are waiting for a reaction off these levels for buys or sells.
The yellow line support has been tested multiple times, therefore, after the number, we may see a knee jerk reaction lower to break this and hit the orange buy zone circa 2340-20. If that fails, look for the grey level circa the 2250s.
On the bigger picture, there seem to be many analogs floating around form 1929-1987 crashes.
On most if not all of these crashes we saw an initial bounce followed by a retest of the low or a lower low before some recovery.
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MiM
Down into the valley rode the SP500 into the 3:50 Reveal where the MOC started off at 3B to sell. We paired off nicely into the close so there were buyers willing to take stock in this market after a two-day rally. As we are getting ready to go to press this AM, that downward momentum continues, but not so bad, just trading around the 2450 area. New unemployment claims will be released at 8:30 am this morning, I have heard numbers from -1 to 1Billion, if we miss that upside expectation it will be because we could not process them fast enough. Watch pre-open and watch the opening MiM to see what funds are doing at the start.
Get the skinny when we get it. Join the MiM.
HFTAlert
Light day on the program. The second day of the rally did not seem to excite the computers with only 31 trades detected, 20 buys and 11 sells.
Chart of the Day
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Globex
| (ESH20:CME) GLOBEX Session | (ESH20:CME) Day Session |
| High 2498.00 | Opening Print: 2444.00 |
| Low: 2386.00 | High 2560.75 |
| Volume: 719,000 | Low: 2393.50 |
| ES Settlement: 2465.60 | |
| Total Volume: 2.9 M |
S&P 500 Futures: #ES ‘Smoke & Burn’ Up 15% in Two Days, Crashes Late
The ES opened at 2444.00, dropped down to 2420.75 and rallied up to 2486 in the first 9 minutes and by traded back down to 2393.50 by 9:14 am CT and then traded up to 2431.50 and then pulled back down to the 2418 area. The ES then popped back up to 2444.00 at 9:38. After the pop, the ES pulled back down to the 2423 area and then rallied all the way up to 2462.50, pulled back down to the 2441 area and ripped up to 2446.50 and then the ES back and filled a bit and then traded up to 2499.00 at 11:51 After the high, the ES pulled back down to 2484.50, traded 2500.25, made a higher low at 2490.50 and then rallied up to 2509.00. After some further back and filling price action, the ES ‘double topped’ at 2517.00, pulled back to the 2510 area and traded up to a new high at 2518.75 at 11:52 CT. The ES then dropped down to 2496 going into 12:00 CT and at 12:09 traded 2529.50 and then up to 2536.75 a few minutes later. After pulling back down to the 2526 area, the ES traded up to 2545.50 at 12:38 CT, up 102 handles or +4.09% and then up to the daily high at 2560.75 a few minutes later. In simple terms, it was one of the largest buy programs I have ever seen.
The ES got hit by a sell program just before 1:00 and the ES sold off down to 2506.75, rallied back up to 2546.00 then back down to 2525 and then back up to 2528.00. The ES traded back down to 2513.50 and back up to 2540.
At 2:00 the ES traded 2543.00, traded in the 2543 area at 2:30 and traded 2470 at 2:50 as the final cash imbalance showed $3 billion to sell and traded down to 2454 at 2:59. On the 3:00 cash close, the ES traded 2467.00 and settled at 2465.50 on the 3:15 futures close, up 23 handles or +0.94% on the day.
In terms of overall tone, the ES acted great until late in the day when several negative headlines hit the tape including one saying AAPL was going to delay the launch of the iPhone 5G, the ES sold off 80 handles in less than 10 minutes after the headline. In terms of the day’s overall trade, total volume was 2.9 million with 719,00 coming from Globex making total day volume 2.18 million contracts traded on the day session.
Our View
Is The Dead Cat Bounce Over?
The S&P rallied 15% in less than two trading days, at 2622 the ES would be up 20% off the lows. It’s been a good run for the bulls the last few days but I think it’s all been the algos squeezing the shorts out, no new money being put to work. I’m not going to do a big view today. We all see what’s going on and despite the rally, the world/markets are in total chaos. I know it’s our job to try and profit from all this but I’m not feeling real good about it.
Our view, there could be one more day of going up but I think we are nearing the high of this rally. If the ES gaps higher tomorrow my lean would be to sell the open and if not, I want to start selling the rallies. I know a lot of folks say it’s just a dead cat bounce and that there is going to be a retest but let’s take this one day at a time. And lastly, I really don’t care whose fault it is but we need that government bailout package passed ASAP!
Market Vitals Technical Analysis
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