Market Review
Globex
| (ESH20:CME) GLOBEX Session | (ESH20:CME) Day Session |
| High 3154.25 | Opening Print: 3141.50 |
| Low: 3111.50 | High 3181.25 |
| Volume: 380K | Low: 3126.50 |
| ES Settlement 3179.00, Up 37.25 Handles or +1.19% | |
| Total Volume 1.38 Million |
S&P 500 RECAP – 7/10/2020
The ES traded 3141.50 on Friday’s 8:30 CT futures open, rallied up to 3147.50 at 9:31, sold off down to the 3133 level at 9:35 and then rallied 17 handles up to 3150.00. After the high, the ES sold off 23.5 handles down to the low of the day of 3126.50 at 9:04. After the decline, the ES rallied back up to 3146.00, pulled back down to 3137.75 and then rallied up to a new high and ‘double top’ of 3160.25 at 11:07 and then sold off down to 3148.00. After the 3148 print, the ES rallied 3159.25, pulled back a bit, and then double topped at 3165.75. The ES pulled back down to 3160.50 and then rallied up to another ‘double top’ of 3168.50 at 1:55. At 2:30, the ES traded 3172.00 and traded 3175.50 as the 2:50 cash imbalance showed $900 million to buy. The ES traded 3176.50 on the 3:00 cash close and settled at 3179.00 on the 3:15 futures close, up 37.25 handles or +1.19% on the day.
In terms of the ES’s overall tone, it looked like the big investment firms were buying tech and selling S&P stocks. In terms of the day’s overall trade, volume was lower at 1.38 million.
Economic Calendar
Closing Prices
In the Tradechat Room
MiM
MiM was not showing much going into the closing hours on Friday. The market was in a nice uptrend, sold off going into the 15:50 pm ET reveal which was an upside surprise of 872M and drove the market up about 6 points and did not offer a reversal trade as we finished on an updraft.
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 quick as possible. We score each state by a normalized slope and ranking in each category (infected, admitted, and deaths).
Montana reminds us that the COVID spread is not just in the big states as it leads the list of case climbers today.
Montana’s cases are on the familar upslope but so far they have not shown up in the back-side of the pipeline. We will be watching how this progresses.
The three largest states with an active climb in mortality: Floriday, Texas, and California are on close daily watch. For estimation purposes, when you look at these states you should remember that Florida has about 20M people, Texas 30M and California 40M.
Particularly alarming on this graph is Texas that nearly doubled its daily date count (7-day average) in just 5 days. July 7th the daily rate was 42, July 12 was 79. During those same 5 days, California went from 60 to 98 around, 35% and Florida’s daily increase was 45 to 73 or 38%.
All three states are at new highs.
Over/Under
These are the over/under numbers for 7/13/2020. 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.
| State | Cases | Deaths |
| Florida | 6366 | 63 |
| Texas | 5318 | 18 |
| California | 11529 | 6 |
| New York | 918 | 8 |
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 mask!
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Our View
Elvis Hits The S&P This Week
As Elvis Presley’s song goes, there’s going to be a ‘whole lotta shakin’ goin’ on’ this week as several major companies report second-quarter earnings. This week investors are going to get a look at how companies fared as COVID-19 swept across America. One of my favorite sayings is ‘there is reason to be concerned’ and according to FactSet, analysts predict that earnings for the S&P 500 plummeted nearly 45%, which would be the biggest drop since a 69% plunge during the depths of the Great Recession in the fourth quarter of 2008. Revenues are expected to have fallen more than 10%. Retailers, energy companies, and industrial firms will likely report the biggest declines in sales and profit.
This morning’s focus will be the record jump in COVID-19 cases and ES3200+. Tuesday, JP Morgan Chase, Wells Fargo, Delta, Citi report second-quarter earnings and the mid-month rebalance, Wednesday, Alcoa, Goldman Sachs, PNC Financial Services, US Bancorp, and United Health (UNH) report, Thursday will be B of A, Johnson & Johnson, Netflix, and Morgan Stanley, and Friday is the July options expiration which according to the Stock Trader’s Almanac has the Dow down 12 of the last 19 sessions.
Our view, its 6:30 Sunding evening and the ES traded up to a new high of 3199.00 and is trading 3189. With the S&P up 6 out of the last 7 sessions, I think it’s possible we pullback in the first part of the day and then rally. If the ES gaps higher my lean would be to sell the open with a tight stop because of all the buy stops above 3200 and buy a 20-handle pullback and get long. Kick back in the middle of the day and come back to beat the guys with the better seats and trade the MIM. 3226-3220 ON TAP.
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
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As always, please use protective buy and sell stops when trading futures and options.
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