Market Review
Globex
| (ESH20:CME) GLOBEX Session | (ESH20:CME) Day Session |
| High 3217.75 | Opening Print: 3209.00 |
| Low: 3199.25 | High 3219.50 |
| Volume: 333K | Low: 3191.50 |
| ES Settlement 3203.25 down 26.25 handles or -0.81% on the day | |
| Total Volume 1.7 Million |
S&P 500 RECAP Trade Date 7/24/2020
S&P 500 RECAP Trade Date 7/24/2020
Weak Economic Numbers And Heavy Tech Selling
The ES traded 3209.00 on Friday’s 8:30 futures open, traded up to 3211 at 8:35 and then dropped down to 3194.25. After the low, the ES ‘dropped and popped its way back up to 3216.25 going into 9:30 am CT. The ES then dropped 15.5 handles down to 3201.00 and then rallied back up to the early high of 3219.25 at 10:03. This may seem like a retread but another large tech sell program hit and the ES dropped and popped all the way down to a new low of 3191.50 at 12:19. After the low, the ES started to rally as the NQ started to short cover. At 1:00 the ES traded 3205.50 and then traded up to 3213.50 at 1:30. The ES then sold back off down to the vwap of 3203.75 at 1:55and traded 3206.00 at 2:00. After the pullback, the ES traded back up to 3214.00 at 2:14. At 2:30 the ES traded 3199.25 and traded 3203.25 as the 2:50 cash imbalance showed $600 million to sell. On the 3:00 cash close, the ES traded 3207.00 and settled at 3203.25 on the 3:15 futures close, down 26.25 handles or -0.81% on the day.
In terms of the ESs price action, it was another day of ‘follow the leader’, the Nasdaq. In terms of the day’s overall trade, total volume was higher at 1.73 million contracts traded.
Economic Calendar
Closing Prices
In the Tradechat Room
MiM
MiM came in a pawltry -625M to sell and nobody really cared. That 15:55 bar become the top volume bar of the day as there became a bit of a buy into the close on a sideways day.
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).
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.
We have watched the new deaths rise after a lag of about 10 days so we expect to start seeing them fall some time this week. There is certainly a slowing in the upside. California is still on its own with a breakout now above the 100 daily deaths. We would expect that rise to continue throughout the week.
Meanwhile, there as some surprising new states struggling like Hawaii and New Hampshire.
Over / Under
These are the over/under numbers for 7/27/2020. 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.
Yesterday’s over/under numbers and actual are also in the table.
| Yesterday | Yesterday | Today | Today | |
| State | Cases | Deaths | Cases | Deaths |
| Florida | 13,965 / 10,249 | 156 / 136 | 10,374 | 92 |
| Texas | 14,916 / 9,507 | 174 / 196 | 7,404 | 62 |
| California | 9,986 / 12,040 | 130 / 159 | 6,846 | 9 |
| New York | 769 / 811 | 11 / 9 | 519 | 8 |
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!
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Our View
Optimism and Volume Fade
The end of July is normally a time when families across the U.S. jump in their cars or take flights to take vacations before the ‘kids’ go back to school. But this is not your normal summer and even at the end of it most kids will not be returning to school and if they do, it won’t last long. Summer also marks a time when exchange trading volume starts to drop but I’m not real sure the drop has much to do with families taking time off and heading to the Hamptons or going to Lake Geneva, Wisconsin. I think when you look at the overall market and you see coffee and lumber prices skyrocket with gold trading $1900 and you get a good look at the economic impact of COVID19 and the fear of states shutting down again and how that is going to affect the economy, people are on edge again. The CME and CBOT stocks have been taking a beating with many of the exchanges top volume products off as much as 20% and the NYSE’s volume has been less than 1 billion shares with 1/3rd of the day’s volume being done on the close. Also scaring people is the fact that their unemployment benefits, also known as Federal Pandemic Unemployment Compensation, ended on Friday. Clearly, optimism has faded as more job loss occurs due to the surge in virus cases. I can’t speak for you but I’m hoping for the best but preparing for the worst.
Our view, the ES and NQ are overdue for a solid day up. If the ES gaps lower my lean would be to buy the open or the first pullback under the gap or just buy the dips. If my lean is right the early low could be the low for the day. I can’t rule out selling a rip but ideally I’m buying weakness and looking for a RIP today.
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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