Market Review
Gagan Daphu – ES Zones
The S&P continues its grind up. We have new targets at 3402 with a fractal projection of up to 3480 for this move.
The new addition to the site is dynamic zones that give traders 2-3 intraday trades a day.
These levels are the yellow lines and appear as the session is ongoing. They can be played with a 3-pt. stop-loss.
FOR TODAY
- Buy 3375 stop 3369 target 3402
- Buy 3368 stop 3365 target 3402
- Buy 3349 stop 3343 target 3374-3402
OVERALL FRACTAL PROJECTION
SPX cleared 3,338 and 3,395 model targets. View remains unchanged. Dips towards 3,375 and even the 3,340-50 area remain buying opportunities for 3,482. The index should stay above 3,335.
If you wish to join us on Zoom for today – ID is 819-562-3358
Economic Calendar
Closing Prices
In the Tradechat Room
MiM
These are the MiM’s I love. slow-growing and stealthy. They sneak by the floor and the markets. Starting early at a small side sell you can see how the total and the percentage number grew every five minutes. At 3:20, the cat was out of the bag, by 3:25 the dollar percent and the symbol percent had reached their 2:1 levels showing deep breadth to both the size and symbol count. At the reveal we had a 1.8B sell-side and while that 5-minute bar sold, the buying returned into the close.
HFTAlert
A quiet day on the HFTAlerts program detector, just six programs, 4 buys and 3 sells. Our 1.8B sell on the MOC reveal at 3:50 pm triggered a small sell program.
Chart of the Day
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Globex
| (ESH20:CME) GLOBEX Session | (ESH20:CME) Day Session |
| High 3382.00 | Opening Print: 3380.75 |
| Low: 3368.75 | High 3393.75 |
| Volume: 230,000 | Low: 3377.75 |
| ES Settlement: 3386.50, up 0.47% | |
| Total Volume: 1.1M |
S&P 500 Futures: Shortened Holiday Week ‘Thin To Win’ RIP
There are many occasions where shortened holiday weeks end up going higher and with volume so low this week clearly the bulls have been busy buying stocks. While the February expiration stats are bearish the S&P 500 futures (ESH20:CME) do not seem to be phased. I know, every time I say that ES 3400 is on TAP the ES pulls back, but I think this week is different!
The ES traded up to 3382.00 on Globex after the news that the China coronavirus numbers were slowing. On Wednesday morning’s 8:30 futures open the ES traded 3380.75, pulled back down to 3377.75 and then rallied up to the 3386 area, pulled back down to the 3382.50 area and then the futures rallied all the way up to 3391.50 at 11:23, up 20.75 handles or +0.59% and the NQH was up 93 points at 9733.00, up 0.96%. Tuesday the ES outperformed the NQ and yesterday the Nasdaq outperformed the S&P. After a small pull back the ES traded up to a new high at 3392.25, pulled back down to 3388.00 area at 12:37 CT and then back up to new highs at 3393.75.
At 2:00 the ES traded 3392.00 as the early MiM showed $209 million to sell and then traded down to the 3388.00 area as the MiM dropped to $657 million to sell, traded 3389.50 at 2:30 as the MiM dropped down to $823 billion to sell. On the 2:50 cash imbalance, the ES traded 3387.50 as the final MiM showed $1.8 billion to sell, traded 3388.00 on the 3:00 cash close and settled at 3386.50 on the 3:15 futures close, up 15.75 handles or +047% on the day. The NQ settled at 9732.25, up 93.75 points or +0.97%.
In terms of the ES’s overall tone, the ES was firm overnight, firm on the open and pretty much firm until the end of the day MiM drop. In terms of the day’s overall trade, total volume was the lowest in several weeks at 1.1 million with 230,000 coming from Globex making the total day volume only 830,000 contracts.
Our view: Buy Nasdaq/Sell S&P Rotation
Rotations in the stock market happen every day. Sometimes it’s buying small caps and selling the big caps. Some days it’s buying the Dow and selling the S&P and the next day it’s buying the S&P and selling the Dow. On Tuesday it was buying the ES and selling the NQ and yesterday it was the reverse, buy NQ and sell ES. This all has to do with how money flows into the ETFs and how mutual funds put money to work in the markets. As investors search for investment opportunities, low yields really leave no place to go but stocks!
The stats for this week’s expiration are not all that great but I am not sure that matters. Every time the ES looks like it’s going to make a run for 3400 it fails but the more it does that the harder the ES will fly through the level. Our lean, it’s always hard to rule out selling the early rallies and buying weakness but the odds have heavily favored buying the pullbacks. I guess it’s just easier to go with the trend and buy the pullbacks. My feeling is when the ES does broach 3400.00 (the big figure) it will more than likely keep going up because of the buy stops that have been building up over the last few weeks.
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.
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