Polaris Trading Group: Taylor 3 Day Cycle Commentary Author: David D Dube (PTGDavid)
***Written 8 pm Tuesday evening for Wednesday’s trading
Tuesday’s Session was Cycle Day 3 (CD3): 3 Day Positive Cycle Statistics were fulfilled as price made a new all-time high but quickly retreated. Market on Close Sell Imbalance of $1.8B capped the session, with a range of 25.50 handles and 995k contracts exchanged on a relatively quiet summer day.
…Transition from Cycle Day 3 to Cycle Day 1
This leads us into Cycle Day 1 (CD1): Price settled the prior session with a solid bid but off the high of the day. Normal for CD1 is for some magnitude decline with average measuring 3364. Volatility and volume have been light with range contraction so achieving average range values may be a stretch. We then have two scenarios to consider for today’s trading:
1.) Price sustains a bid above 3385, initially targeting the 3395 – 3400 zone.
2.) Price sustains an offer below 3385, initially targeting the 3375 – 3370 zone.
For more detailed information for both bullish and bearish projected targets, please visit: PTG 3 Day Cycle and/or reference the Cycle Spreadsheet below:
Link to access full Cycle Spreadsheet >> Cycle Day 3
Thanks for reading,
Polaris Trading Group
In the Tradechat Room
Yesterday’s MOC was almost 2B to sell which pushed the 13:50 candle down about 3 points and then entirely recovered on the 15:50 candle. Our cash close was just about even with the 2 pm open with an 8-point range squeezed in between, a small closing range.
Questions? Please email me: Marlin@mrtopstep.com
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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).
Everyone was under yesterday and we show it on the charts with Florida regaining its momo. Texas has a lot to prove today and tomorrow heading into the weekend and California now says they are beyond their new cases data issues.
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.
Like the comments above for new daily cases, all 3 states beat their under numbers and show a down-turn on their 7-day averages for daily new deaths. Proof for a trend should begin to be established over the next few days.
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.
|Florida||5,831 / 3,838||277 / 219||8,109||213|
|Texas||9,803 / 7,282||220 / 216||6,200||324|
|California||12,500 / 4,636||109 / 100||11,645||180|
|New York||667 / 655||7 / 8||528||7|
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!
Chart of the Day
|(ESH20:CME) GLOBEX Session||(ESH20:CME) Day Session|
|High 3387.75||Opening Print: 3382.75|
|Low: 3371.50||High 3390.75|
|Volume: 200,000||Low: 3365.25|
|ES Settlement 3386.25|
|Total Volume 997,000|
S&P 500 RECAP – Trade Date 08/18/ 2020
#ES Money Maker Chart
#ES Money Maker Chart
#ES 3390.75, One Inch At A Time
After a 16.25 handle Globex range which remained sideways, the S&P 500 futures opened Tuesday’s regular trading hours at 3382.75, up 2.75 handles, and rallied up to 3390.00 in the opening half hour, up 10.00 handles on the session. There, the S&P’s would meet sellers, as the index futures reversed, selling off down to 3365.25 in an hour’s time, a 34.75 handle pullback. The market would mostly trade inside that opening hour range for the remainder of the day, as buyers came in pushing the ES back above the open by late morning.
The afternoon saw a slowdown in price action, as the futures would maintain a 9.25 handle range in a grind up to 3380.75 just after 2:00 before pulling back to the open of 3382.50 late in the session and then settling the day at 3386.25, up 4.25 handles or +0.12%.
In terms of overall price action, the day was about two sides of the market. The sellers just before 9:00 were rewarded, as well as the buyers of the first hour low. In terms of volume, it was another extremely light day with just under a million minis traded.
No One Promised Us A Rose Garden
What can I say that hasn’t already been said? It’s the end of the summer doldrums and the ES is less than 8 handles off its all-time contract high. I know some people want to sell this but to me, it’s just too thin and too firm and there are too many buy stops to run. I am going to keep this short and sweet. Our lean is the same as yesterday, you can sell the early rally and buy the pullback or just go with the trend and buy the pullback. If the ES starts trading above 3392 I think it will be off to the races.
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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