Market Review
Globex
| (ESH20:CME) GLOBEX Session | (ESH20:CME) Day Session |
| High 3117.75 | Opening Print: 3094.50 |
| Low: 3062.75 | High 3117.75 |
| Volume: 360K | Low: 3089.25 |
| ES Settlement 3102.50, up 12.25 handles | |
| Total Volume 1.5 Million |
Wednesday’s S&P 500 (ESU20:CME) Recap
COVID19 Concerns And New Vaccine
The S&P 500 futures traded 3094.50 on yesterday’s open, traded up to 3108.25, sold off down to 3092.50 at 8:57 and then rallied up to a new high of 3111.75 at 9:33. After the high, the ES dropped 22.50 handles down to the day’s low of 3089.25 after Arizona, California and Texas reported record single-day increases of new COVID19 cases. After the low, the ES started to short cover and traded up to 3113.50 at 11:39. After the high, the ES pulled back and then ‘back and filled’ until the MIM started out showing over $300 million to buy and then jumped to over $600 million to buy. As the MIM moved up the ES rallied from the 3102 level at 1:43 all the way up to 3117.75 just as the MiM dropped from $1 billion to buy to $300 M to buy and the ES sold off down to 3100.75 on the 3:00 cash close. The ES settled at 3102.50, up 12.12 handles.
In terms of the ES’s overall tone, it was like I said in the MrTopStep forum and Twitter late in the day; something was missing, meaning it all looked too easy to have another late-day run-up and the MiM FLIP resolved that problem. In terms of the day’s overall trade, volume was stray at 1.5 million
DATA/HEADLINES:
8:30ET US Employment Report*; 10:00ET Factory Orders; 2:00ET Fed’s Barkin and Daly speak on the economy.
Economists polled by Reuters expect 3 million U.S. jobs to have been added in June, which would be the most since the government started keeping records in 1939. The June labor report and weekly jobless claims may show the carnage abating, but the figures don’t tell the whole story. Misclassifying out-of-work Americans as employed has skewed the jobless rate, distorting month-on-month comparisons. Consensus sees a hiring increase of 3.1 million versus 2.5 million in May, the unemployment rate falling to 12.5% from 13.3% and hourly pay down 0.7%. Prime Minister Boris Johnson’s government will allow almost 3 million Hong Kong citizens to move to the U.K., risking a further escalation of tensions with China after it enforced a sweeping security law on the former British colony.
TODAY’S HIGHLIGHTS:
Encouraging economic data worldwide and hopes for a coronavirus vaccine pushed global stocks higher, with focus turning to June U.S. employment data and weekly initial jobless claims data.
Today: ESU / SPX / DOW :
US Index futures are higher ahead of the June employment report that’s coming a day early because markets will close Friday for the July 4 holiday. Signs of the U.S. economy’s revival has bolstered optimism among some investors that the damage caused by the coronavirus pandemic could be quickly erased. That, combined with speculation that the Federal Reserve and the government will continue funneling large amounts of money to American businesses and households, is propelling stocks higher.
E-Mini S&P is up 0.8%, Nasdaq +0.6% (new all-time high), RTY +2.2%, Dow futures +1%. S&P holding a short term positive tone above its 50-day and 200-day moving averages. 3157 area remains key resistance.
Economic Calendar
Closing Prices
In the Tradechat Room
MiM
Although we had a nice MIM on Tuesday (end-of-quarter) Wednesday’s MiM was not jelling into any breadth on the symbol % number. Briefly over 66% at 15:15 until 15:30 when it waned back. For the early traders, the 15:15 could have been taken with an exit when the 66% disappeared for some profit entry, there was some long profit to be had.
The 15:50 reveal was a down-side surprise with just 190M to buy as the real size of the sell-side was released and a nice 13-point sell into the close persued.
If you don’t understand what is happening at the close and don’t have the information then don’t trade that last sixty minutes.
Questions? Please email me: Marlin@mrtopstep.com
Get the skinny when we get it: Join the MiM.
Covid – Lock Down 2.0
Our Covid-19 table scans the latest data of all 50 states looking for trends, not top-line numbers. The pipeline is infected => admitted => died. That is a terrifying pipeline and we don’t want any of those trending up. On the table, we take a seven-day average (bad data) and then we take a 5-day linear regression slope from the last five 7-day averages and we don’t want a positive slope, that means up.
The number of “green” infected states has really eroded over the week and our score has a surprising Idaho as a hot spot worth watching and California does not make the top ten.
All the columns in the table are sortable so you can find the best and worst of any column and if you click on a cell you should get a chart for that cell. The chart for Idaho’s 7-day infected average looks like this and helped earn it the top spot.
Feedback, help always welcomed: marlin@mrtopstep.com
Table: https://t2r4.com/cv19/views
Chart of the Day
Top Stories on MTS Overnight:
Our View
Jobs Thursday
Because of the shortened holiday week, today is ‘Jobs Thursday’ and this morning’s June employment report is expected to show 3 million jobs were added as employers rehired, on top of 2.5 million in May. But there are still nearly 20 million people collecting state unemployment benefits and millions more collecting under a federal program as of last week. I am not exactly sure how the number is going to play out but I do know two things; the first is the ES is trading at the high end of its trading range and 2) I have a hard time seeing why anyone would dare go home long. Why, you ask? There are several answers to that question and the first is the record rise in COVID19 cases, the 3-day weekend, and the possibility that the New York police could go on ‘strike’ on the 4th of July in protest of anti-police rhetoric and budget cut proposals. Chicago and NY have been killing fields since the street riots and some protesters are continuing their occupation of City Hall following a City Council vote that included $837 million in budget cuts and funding reallocations involving the New York Police Department (NYPD). My guess is we see a record number of shootings.
Our view, I am not sure how the jobs report will pan out but I told the PitBull I thought we were heading back to 3200. As for today, ideally I want to buy the pull backs but that doesnt mean I won’t sell a sharply higher open.
Have a safe and happy 4th Of July,
DBOY
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.
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