Market Review
WYCKOFF AM TRADER
Ok, some say it was the banks, I say it was the spring from May 3 low of 2771 handle. If you recall, that was made overnight Globex weekend. I talked about it before the market opened in my Early Read video I do each day for my subscribers to the AM TURN.
https://my.demio.com/ref/3J8qGhRrg5jONb3u
It’s normally for AM Turn subscribers only. I’ll share this fourteen-minute video with you if you like. It talks about the characteristics of an S3H day and how WB’s savvy looked at the relationship of two turns to get a read on the potential for the last hour.
FYI for those of you who knew and loved WB we are coming up on the anniversary of his passing Either 5/20 or 5/21 of 2017 it was never known for sure. We only knew it was the weekend…
Below is a peak of the Wyckoff Wave. Wyckoff said, most traders only look at the skeleton of the market, the Wyckoff Wave gives you the whole body of the market. It is more responsive than the DOW Futures or indexes.
Without going into great detail these are one-minute bars. You can see the volume spike by the white dot. Volume is intense, never been like that. Yea, I think it was well bid at those levels. Notice volume is consistent on the way down and on the way back up. Somebody was definitely loading up their wheelbarrow.
Buffett said he was unable to get some on the bottom of March. He should have had no problem yesterday (5/14)!
Volume was 1.9M that has the potential for a selling climax. And the rally off those lows shows strong demand. I’d say look at how high the volume is consistent. The pundits said somebody got on the mike and said something….
LOOKING FORWARD — FRIDAY, MAY 15, 2020
Ok, now factor in that the NYS Exchange said they are going to open up the exchange for limited trading starting May 26th. And we just happened to find this low on the 14th? Are they saying the ALGO’s did all the heavy lifting on the rally but now we need the humans?
I’m no Oracle of Omaha, but two-thirds of the pundits on a hot mike are close to hoping for a second wave to hit. The whistleblower said to look for fall or winter… and everybody is just waiting to see what happens in Texas?
From a technical position shares/lots looked to have traded from the weak to the strong hands. Why do they think we need the humans on the trading floor now? That would be my concern…
Even with the humans back, Algos still run the trades and are the market makers in all the securities…
By my eye price is almost right in the middle of a trading range once again. America is getting back into the spring of things, and really willing and able to open back up. That is providing the Governors and mayors are willing to let it happen.
If the bulls are going to take back control, one would expect not to touch yesterday’s low again unless a bearish catalyst encourages selling pressure back into the market. If we do retest the low of May 5, volume should be severely reduced for a successful test.
It’s a Friday, and yes we had a great week. Globex has held the lows and currently trading 2857 handle. About twenty handles away might be the first hurdle for the bulls. I can’t imagine things could/would turn bearish today.
But anything can and will happen in the market. Jessie L said: “The market teaches me a new lesson every day!”
If you get a chance, perhaps during the Lunch SLOG, check out the fourteen-minute video:
https://my.demio.com/ref/3J8qGhRrg5jONb3u
We had a good week this week. Our subscribers have been very lucky with the levels given: 35 points Monday, 60 Tuesday, 22 points Wednesday, 29 points Thursday. Total for the week 146 points, that would be $7,300 on 1 lot and $21,900 on 3 lots.
That’s due to the volatility that crept back into the market. That is if your brokerage firm allowed you to take every trade.
I’ll be the first to say, it does NOT happen every week.
When it does it’s a beautiful thing! I would love for you to join us.
Click the link below to learn more.
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MiM
Early data started negative but by 3:35 we were definitely pointing more positive and that symbol % number crossed the 66% threshold as the MiM steadily strengthened its buy bias. The 3:50 reveal capped it off and we close on the highs. Nice trades were had by all.
Questions? Please email me: Marlin@mrtopstep.com
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Globex
| (ESH20:CME) GLOBEX Session | (ESH20:CME) Day Session |
| High 2825.00 | Opening Print: 2786.25 |
| Low: 2777.00 | High 2853.75 |
| Volume: 525,000 | Low: 2760.25 |
| ES Settlement: 2846.75, up 27.75 handles or +0.98% | |
| Total Volume: 2.45M |
S&P 500 Futures: Thursday’s Angry Rally
The ES traded 2786.25 on Thursday’s 8:30 futures open, traded 2760.25 at 9:00 am, traded back up to 2812.50 at 10:18 and traded back down to 2786.25 at 10:42. After the pullback, the ES traded back up to 2833.00 at 12:31, traded back down to 2809.75 and after the MiM showed buy $1 billion and traded up to a new daily high at 2853.75 just before the 3:15 futures close. It was as the title says; an ugly rally.
In terms of the ES’s overall tone, all I can say is the early sell-off led to an all-day rally. In terms of the day’s overall trade, 2.45 million ES traded with 525,000 of the volume coming from Globex making total day volume 1.925 million traded on the day session.
Our View
Last 5 Days
I wanted to do something different today. I am going to go back and pull the last 5 days of ‘Our View’ and go over my calls. I live by some basic trading rules, the first is I follow patterns and number two is ‘the trend if your friend and don’t ever forget it’ and the last rule is we are not here to ‘fight city hall’ if the ES is going up or down… we want to go for the ride. I knew last Friday that the ES was running out of steam and that the negative news was starting to overflow. And going into Friday was when I started to change my tone. I think my calls have been pretty decent lately.
Below is the last 5 days of MrTopStep’s Opening Print Our view
5/08/20
How Far Is Far?
Recently the S&P has been making good of the bad news but I don’t think that’s how it’s going to play out after this morning’s jobs report. I am not going to do a big view but what I will say is if the ES is sharply higher after the jobs number my lean would be to sell the open. We have run a lot of buy stops and the ES is short term overbought. After the drop, we will be looking for the 11:00 low and bounce and then I think we could see the ES head lower in the afternoon trade.
That call was right on and the beginning of the end of the rally.
5/11/20
Most Hated Rally In History Continues
The markets continue to rally the shorts, i.e. the big institutional hedges are being lifted and the losses are starting to add up. As of Friday, the ES has rallied an incredible 1,124 handles or 27%. No matter what you think, it’s hard to argue with. On one side of the room are the dip buyers who are running the tape and on the other side of the room are the thirsty bears who are screaming for lower prices.
Our view, the ES opened lower on Globex and rallied and then pulled back. I still think 2950-2960 is in the cards I just don’t know about today. Our lean is to sell the early rallies and buy the mid-morning pull back and then wait for the late day MIM pull pack. Beyond today my gut says we see some type of pullback this week. It’s just been too easy on the upside.
The ES made a high at 2947 and a low at 2889.75
5/12/20
No Reason To Be This High
When you add all the negatives up there is absolutely no reason for the index markets to be up this much. That said it really doesn’t matter what I think because the S&P is going to do whatever inflicts the most pain. It is how the game is played. When you risk more the markets will take it. When you have a big winner you feel the need to take it and then it keeps going your favored way. Only the algos know when everyone is too long or too short and yesterday’s day trade was a PERFECT example of people being too short and buy stops to run. I do not know the exact date and time but I see dark clouds forming for the stock market.
Our view, if the ES gaps higher I plan on selling the ES. It’s overdue for a few down days and that’s how I’m playing it.
The high was 2939.25 and the low was 2838.00
5/13/20
Nasdaq Composite Up 6 of the Last 7 Sessions
I started out today’s OP writing about all the ups and downs and the downs erased all prices action at 6:30 CT. The ES is trading 2835.50, down 3 handles during Tuesday night’s early Globex session. I am going to spare you the gory details but the ES sold off from an early high of 2937 after the open all the way down to 2851.25, down 70.75 handles or -2.40% on the day. Our view, as the day wore on so did the markers. My feeling is the ES can bounce but not hold. Our lean is to sell the 20 to 30 handle rallies.
5/14/20
What Lies Ahead?
Our view, the first thing I want to point out is we have not seen many 3 day declines recently and the other is called dividend reinvestment. Dividends are generally paid out four times a year or quarterly and put back to work in the stock market at mid- month.While many people believe mid-month falls on the 15th it really starts on the 14th which is today. While I really do not like the S&Ps price action I also don’t want to get ahead of myself. Our lean, buy the pull backs. I think we are going back to 2850-2860.
Yesterday, the ES made a low at 2760.25 and rallied up to a late day high at 2853.75, 93.50 handles off the low.
I do not have any fancy tools. I follow patterns and volume, I don’t have any fancy indicators but the above is a good example of what I call my gut feel for the markets. Yesterday near the lows I sent this out and at the time the ES could not have looked worse; IMPRO: Dboy :(8:41:09 PM) : acts weak but not sure they can get 3 down days in a row IMPRO: Dboy :(9:47:56 AM) : if I am right, there will be an early low that we won’t see again today. Sometimes I deserve a pat on the back, huh?
Our view, big 2 1/2 day sell-off and then an almost 100 handle rally and closing on the highs. That’s not bearish price action. Today is the April options expiration and short call positions that were not a worry at yesterday lows could come into play if the ES squeezes higher, especially the 2880s and 2900.00s. If the ES gaps 20 to 30 higher I would sell the open and buy the midmorning pull back. After that, it may be pool time and then come back and trade the last hour.
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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