Market Review
ES Zones Update
New recovery highs overnight on the back of Fang earnings, MSFT and FB. The market is on the verge of hitting 3000 on the S&P to most people’s disbelief considering the economic data coming out regarding jobless claims etc. On a side note, if you look back to the big gap up on the 23rd March it was when David Tepper came on CNBC and said he was buying tech stocks, looking back now I remember the same thing happened in 2011 when he came on CNBC saying bad news was good news and the market never looked back.
The S&P and Nasdaq are so concentrated with those few tech stocks that you need to just look at those 5 or 6 charts and I think you would think twice about shorting this rally on the back of the economic releases we have every day. Amid all this, we are having to deal with the ongoing confusion in how to judge the narrative regarding negative data and positive central bank policy effects. I would say that the upside for traders in all of this is that there is a decent amount of range on most days to make money both ways, so we need to embrace it while it lasts.
For today.
Intraday Bias is bullish above 2927. Whilst above 2927, we target 2998 and up to 3037 top of the range.
A break and hold below 2927 brings the Globex level 2890 with stops circa 2880, below that we have downside targets at 2750 and 2700 ( see table below)
You can see the targets on the right hand column, 2998 being the closest one to the upside. Be aware the downside ones. I suspect we may see them in the next couple weeks.
On the model indicator, you can see we are pretty extended on a weekly and daily basis. Above 80 is overbought, below 25 is oversold.
Overall that 2927 is our over/ under line.
We have jobless claims and Amazon later so plenty of volatility coming the next 24hrs.
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Good Luck!
Gagan Daphu
ES – Zones
Economic Calendar
Closing Prices
In the Tradechat Room
MiM
We are end-of-month and MIMs should be pretty large. Yesterday we saw a 1.5B sell. Still no directional symbol conviction. This is one of the first 3:50 pm candles that has not retraced as the MOC sale push the momentum to sell into the close from what had been a very fine day for the bulls.
Our A/D line stack is still showing that small caps are playing catch-up as they lead the way with the S&P 500 on the bottom moving below 4:1 into the close.
Questions? Please email me: Marlin@mrtopstep.com
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Globex
| (ESH20:CME) GLOBEX Session | (ESH20:CME) Day Session |
| High 2926.25 | Opening Print: 2913.25 |
| Low: 2860.00 | High 2913.50 |
| Volume: 410,000 | Low: 2902.25 |
| ES Settlement: 2940.25 | |
| Total Volume: 1.65 M |
S&P 500 Futures: Fed’s Printing Presses and QE4 On Steroids
I am a bull market guy and like many, I have been waiting on that ‘retest’ of the lows while the S&P just continues smoking higher. As of yesterday’s close, the ES is up 752 handles from its 2177 low and is now only 497 handles off its all-time high of 3397. At 11:45 am CT yesterday the ES made a new high at 2940.50, up 80 handles or +2.78%. The NQM made a high at 8964.75, up 265 points or +3%. Has the S&P sailed? It sure looks that way. Like I have always said, we are not here to fight city hall, if the ES is going up we want to go for the RIDE! How long will it last? It will last until all the shorts are squeezed out and everyone’s long, after that we start going back down.
The ES traded 2913.25 on yesterday’s 8:30 CT futures open. The ES dropped down to 2902.25 at 8:37 CT then rallied up to 2922.50 at 9:36 am CT. It ‘dropped and ‘popped’ then traded up to 2935.00, made a new high at 2942.25, sold off another five handles and rallied up to a new high of 2944.50 at 12:11. After the fed headlines the ES sold off down to 2923.25 at 1:13. After the sell-off, the ES bounced back up to 2935.00 and then back down to 2928.25 at 1:31.
At 2:00 CT the ES traded 2937.00 , traded 2945 at 2:30 and traded 2943.25 as the 2:50 cash imbalance showed $800 million to sell. On the 3:00 cash close the #ES traded 2931 and settled at 2940.25, up 79.75 handles or +2.79% on the day.
In terms of the tone, the ES rallied Tuesday night and rallied hard yesterday. In terms of the day’s overall trade, a total of 1.65 million ES traded with 410,000 from Globex making total volume 1.24 million on the day session.
Our View
S&P 500: Best Month Since 1974
After being down over 34% the S&P has come flying back. In the last three weeks, the ES has rallied 13%. That’s quite an accomplishment, all considered. After making a low at 2177 on March 23, the S&P has rallied a whopping 30% in 26 sessions. The Nasdaq futures made a contract high at 9780.50 and a low at 6628.75, a loss of 3,152 points. As of yesterday’s 9014.75 high, the NQ has rallied 2,386 points or 37% in 25 sessions. That’s more than a whole year’s gain.
All the BS about tech weakness just isn’t real. The big tech names are back in the saddle as the market leaders. As of yesterday’s close, the ES is down roughly 10% in 2020, the NASDAQ is down less than 1%, the Dow Jones is down 14% and the Russell that started the week down over 30% has gained over 10% in the last three sessions but is still down 19% YTD. I know I have ‘zig jagged’ but I said a few weeks ago that I thought the ES could trade 2930-2950 and we hit it.
Our view, today could be another busy day, it starts out with some big tech reporting, the jobless claims number at 7:30 CT and the ECB policy announcement that is expected to include significant ‘new measures’. Our lean is to sell the early rallies and buy the midmorning pull back and wait for the late day pull back and get long for the close. After the best month since 1974, we think it’s a good idea to use tight stops. While we think higher I also can not rule out a 30 to 50 handle pull back.
Market Vitals Technical Analysis
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