Sell The Rumor, Buy The News

Commentary, News

Index Futures Net Changes and Settlements:

ContractSettlementNet Change+/-%
S&P 500 (ESU19:CME) 2979.50+11.75+0.39%
DowJones (YMU19:CBT)26,797+97+0.36%
Nasdaq 100 (NQU19:CME)7838.25+48.25+0.61%
Russell 2000 (RTYU19:CME)1566.30-7.30-0.46%

Foreign Markets, Fair Value and Volume:

  • In Asia 8 out of 11 markets closed lower: Shanghai Comp -0.94%, Hang Seng -0.07%, Nikkei -0.53%
  • In Europe 13 out of 13 markets are trading higher: CAC +0.62%, DAX +0.65%, FTSE +0.75%
  • Fair Value: S&P +3.54, NASDAQ +26.15, Dow -7.04
  • Total Volume: 1.1 million ESU & 642 SPU traded in the pit

*As of 7:00 a.m. CST

Today’s Economic Calendar:

Today’s economic calendar includes Motor Vehicle Sales, MBA Mortgage Applications 7:00 AM ET, Challenger Job-Cut Report 7:30 AM ET, ADP Employment Report 8:15 AM ET, International Trade 8:30 AM ET, Jobless Claims 8:30 AM ET, PMI Services Index 9:45 AM ET, Factory Orders 10:00 AM ET, ISM Non-Mfg Index 10:00 AM ET, EIA Petroleum Status Report 10:30 AM ET, EIA Natural Gas Report 12:00 PM ET, NYSE Early Close, and SIFMA Rec. Early Close 2:00 ET.

S&P 500 Futures: #ES3000 Is Coming

Chart courtesy of Scott Redler @RedDogT3$spx futures +6 handles after holding 2952 yesterday. Now see if can hold above 2972-2977 area for more traction. Manage your trades.

During Monday nights Globex session, the S&P 500 futures printed a low of 2959.75, a high of 2972.00, and opened Tuesday’s regular trading hours (RTH) at 2967.50.

After trading sideways in a 12 handle range all night, the ES shook a few weak positions off the stick, first trading down to 2963.00, then back up to 2968.50, after the 8:30 CT bell. From there, the benchmark futures finished the first hour of trading by rallying up to a new high at 2973.50 just after 9:30.

Once the smoke cleared after the RTH open the headline algos took over, and pretty much anything that crossed the tape was taken as a negative. A fake headline about why vice president Pence had to call off his trip first forced the ES down to 2961.75, then more rumors swirling around eventually took it down to 2958.50.

As the old adage goes, “sell the rumor, and buy the news.” Fake news on a ‘no news’ day couldn’t stop stocks from taking the path of least resistance. Sellers got run over, and buyers got paid. If you kept track of the MiM over the last few days, then you probably saw it coming.

When the MOC reveal came out showing another $546 million to buy, the ES had already rallied 14 handles off its lows. The buying continued, and the futures went on to print 2976.50 on the 3:00 cash close, and 2979.75 on the 3:15 futures close, up +12 handles on the day.


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As always, please use protective buy and sell stops when trading futures and options.

Disclaimer: Trading Futures, Options on Futures, and retail off-exchange foreign currency transactions involves substantial risk of loss and is not suitable for all investors. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge, and financial resources. Any decision to purchase or sell as a result of the opinions expressed in the forum will be the full responsibility of the person(s) authorizing such transaction(s). BE ADVISED TO ALWAYS USE PROTECTIVE STOP LOSSES AND ALLOW FOR SLIPPAGE TO MANAGE YOUR TRADE(S) AS AN INVESTOR COULD LOSE ALL OR MORE THAN THEIR INITIAL INVESTMENT. PAST PERFORMANCE IS NOT INDICATIVE OF FUTURE RESULTS.

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Danny Riley (3597 Posts)

Danny Riley has worked in the futures and options industry for 38 years, including the CBOT’s bond room, where he worked for several of the Market Wizards. He went on to build the largest volume desk in the S&P 500 Index Futures, serving some of the largest banks and hedge funds, the UBS program trading business, and some of the world's top individual traders. As a leader and co-creator of the MrTopStep IM-Pro Trading Room, he shares trading ideas and breaking market news live from the floor with our other professional traders and new traders eager to experience the power of collective intelligence. Join us today and get the edge only social trading can give you.

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