Market Review
GLOBEX
| (ESH20:CME) GLOBEX Session | (ESH20:CME) Day Session |
| High 3380.50 | Opening Print: 3363.50 |
| Low: 3350.00 | High 3356.00 |
| Volume: 218,000 | Low: 3357.50 |
| ES Settlement 3362.00 | |
| Total Volume 1.05 Million |
S&P 500 RECAP – Trade Date 08/14/ 2020
#ES Money Maker Chart
#ES Retreat From the Highs
After selling off down to 3350.00 during the Globex session, the S&P 500 futures rallied to open the regular trading hours on Friday at 3363.50, down 3.50 handles. The ES printed a morning low of 3358.50 in the opening half-hour and then rallied through the morning making a series of higher lows and higher highs as the benchmark futures index traded up to a 3373.50 high of the day just after noon, up 15 handles off the early low, and 23.50 handles from the Globex low.
The afternoon saw a consistent trade lower as the index futures were in a slow grind down to 3356.00, a 17.50 handle retreat from the highs going into the final half-hour of the trading day. There, once again, buyers came in, thrusting the futures higher into the close as the ES went up to 3368.25, a 12.25-point rally in the final minutes of the day, before trailing off to settle the day at 3362.00, down 5.00 handles or -0.14%.
In terms of the overall trade, it was a very light volume day with just over a million contracts traded, however, the price action was moderate with a 17.50 handle range on the day. It was all about buying the morning and selling the afternoon.
Economic Calendar
Closing Prices
In the Tradechat Room
MiM
The MiM showed a sell all the way until the 15:50 MOC lockup which was about 1.5B to the sell-side. The reveal became a relief after a solid hour and a half of selling and the 15:50 candle shot up 8 points and faded about half of that into the close.
Questions? Please email me: Marlin@mrtopstep.com
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Covid-19
We continue to track Covid-19 across all 50 states, DC, and Puerto Rico to gain a better understanding of what is happening. While detected cases continue to expand, we are not seeing the equivalent expansion in hospitalizations and deaths. Our table uses 7-day averages and takes a 5-day linear regression slope in order to detect changes as quickly as possible. We score each state by a normalized slope and ranking in each category (infected, admitted, and deaths).
If you don’t believe this is going to be a long, hard slog with COVID then you are not watching these numbers. Florida has regained its downside momentum, down 50% in new cases from their high of about 12K per day down to 6K. Texas can’t seem to produce the same type of move and is struggling to get the cases to go down and California is having a data crisis as well as a COVID crisis. I don’t think that curve for CA is accurate if it is then they are on a re-surge.
We continue to focus on our top 3, Florida (20M pop), Texas (30M), and California (40M) looking at daily deaths, but more importantly, changes in the count.
The disappointment is in the lack of downside movement in new deaths as Florida re-approaches their record highs, Texas has plateaued at 200, and CA at 140. We are at the start of the week with small numbers since we don’t work on the weekends during the emergency so if there are to be large movements we won’t see them until starting around Wednesday.
Last Friday the 3 states beat there under numbers in new cases put were all 3 over on daily deaths. Not a good trend as we have been expecting to see decent drops in daily deaths for about 2 weeks now.
Over / Under
These are the over/under numbers for today. In order to push the 7-day average lower, today’s reported numbers need to be lower than the target number. A new case or death number that is higher will increase the 7-day average.
Yesterday’s over/under numbers and actual are also in the table.
| Yesterday | Yesterday | Today | Today | |
| State | Cases | Deaths | Cases | Deaths |
| Florida | 7,686 / 6148 | 180 / 229 | 4,155 | 93 |
| Texas | 7,039 / 7,018 | 293 / 313 | 4,455 | 31 |
| California | 8,436 / 7,934 | 142 / 188 | 7,751 | 66 |
| New York | 714 / 727 | 5 / 4 | 476 | 2 |
Use today’s number to watch the releases to determine the trend.
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
Mutual Fund Monday
Many moons ago one of MrTopStep’s favorite trading rules was called Mutual Fund Monday. The theory works like this; money that is wired into mutual funds and ETFs on Thursday hits the account Friday and money wired in on Friday hits the account Saturday, thus the money accumulates over the weekend and is put to work on Monday. The trade/pattern of buying on the close on Friday and holding into Monday was not only a very profitable trade it also lasted four or five months before it stopped working. The trade also coincides with the PitBulls Thursday / Friday low the week before the August options expiration this Friday. Today is Mutual Fund Monday.
Our view, picking the exact time the S&P will make a new contract high has not been an easy trade. In fact, selling the ES at 3380 has been a very profitable trade if you caught it but so has buying the pullbacks. It’s 9:00 PM Sunday and the ES is up 10 handles at 3371.50. While some feel the price action is bearish I see something else and it’s called ‘back and fill’ which is a bullish pattern. I doubt the ES can make new highs today but I think they will this week. Our lean is to sell the early rallies and buy the pullbacks. All the drops have done is add more buy stops above 3382.50. I would not sell into that level next time up.
Danny Riley is a 39-year veteran of the CME trading floor. He has helped run one of the largest S&P desks on the floor of the CME Group since 1985.
Market Vitals Technical Analysis
Did you know that your premium membership gives you access to our Market Vitals? Click on the image below and get today’s key levels.
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.
