On Wednesday’s close, the S&P 500 futures (ESU17:CME) popped back up, but got killed overnight when Europe sold off. The big loser on the 8:30 CT open was the Nasdaq (NQU17:CME), which sold off all the way down to 5641.25 a few minutes after the open, and then ran all the way upto 5662.75 10 minutes later. The S&P 500 futures (ESU17:CME) opened the day session at 2419.50, popped up 2424.00, sold off down to 24418.00, rallied up to 2425.00, and then dropped down to 2416.75, two ticks below the weekly low, before rallying up to the 2422.00 area.

At 9:50am CT there were already 810,000 ESU’s traded. The ES was stuck in a 2 handle range until 10:00 while the Nasdaq was making some big moves. At 10:35, the NQU started moving up again, printing 5687.00, and helped take the ESU up to 2428.25. After making the highs, both indices pulled back, and then the NQU traded back up to the high print for the third time. The ESU was lagging, but as the NQU started to take out stops above 5987, the ESU started to trade up again, but was still ultimately lagging. The Nasdaq traded up to a new high 5693.25, and the ESU slowly traded up to 2427.25 at 12:00, then up to 2427.75.

Whenever Europe drags the ES down, and gaps down as it did, there is always a tendency to run the buy stops. The algos always go after the nearby buy stops, and yesterday, after running the downside sell stops before the open, that’s exactly what they did.

On Wednesday, The PitBull said that there could be a ‘mid month rebalance,’ and guess what? Yesterday was the 15th. The next push in the NQ took the ES up to 2432.00. Both market started to pull back as the MiM started to show $370 million to sell. Just before the imbalance came out, the NQ sold off down to 5698.50, and the ES sold off down to 2426.75. After that little sell off, both futures popped back up a little, and the ESU finished the day at 2432.00, down -3.25 handles.

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While You Were Sleeping

Overnight, equity markets in Asia traded mixed, with a slight bias to the upside. Meanwhile, in Europe, for the second day in a row all major markets are trading higher, led by the Swiss SMI-Index, which is up over 1% this morning. In the U.S., the S&P 500 futures followed suit with the strength in Europe and Asia, and is trading modestly higher this morning.

The ESU opened the globex session at 2431.25, and found a low of 2429.75 just before 6:00pm CT. The futures caught a bid as the Asian markets opened, and printed an early high of 2434.75 at 7:30pm. From there, the ES slowly drifted higher for the rest of the Asian session, and printed the overnight high of 2436.75 just after the European open. Since then the futures have been trading in a 3.5 handle range between 2436.75 and 2433.25. As of 7:20am CT the last print in the ESU is 2433.50, up +1.75 handles, with 140k contracts traded.

In Asia, 7 out of 11 markets closed higher (Shanghai -0.31%), and in Europe 12 out of 12 markets are trading higher this morning (FTSE +0.68%) Today’s economic calendar includes the Quadruple Witching, Housing Starts, Atlanta Fed Business Inflation Expectations, Consumer Sentiment, Robert Kaplan Speaks, and the Baker-Hughes Rig Count.

Welcome To The June Quad Witch

Our View: Romp & Roll! A big move down on the open, and then a big blast up. Yesterday’s rally was planned out before the open. The guys with better seats took the ball and ran with it. They flushed out the sell stops, then set their sights on the buy stops.

Today is the June Quad Witch, which is the simultaneous expiration of stock index futures, stock index options, stock options and single stock futures, and it should bring some volatility throughout the day. Our view is to buy the early weakness and sell the late day rallies, but don’t fall in love with any positions today, there’s a possibility of high volatility.

Download the S&P cash study for the June expiration here

Join Marlin Cobb and Neils Koops for a FREE WEBINAR Saturday, June 24th at 10:00am cst. Learn all about trading the close with the MrTopStep Imbalance Meter (MiM), and get some insightful tips on maximizing Investor RT charting software. Hope to see you there!

Sign Up Here

Market Vitals for Friday 06-16-2017

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

• In Asia 7 out of 11 markets closed higher: Shanghai Comp -0.31%, Hang Seng +0.24%, Nikkei +0.56%
• In Europe 12 out of 12 markets are trading higher: CAC +0.71%, DAX +0.22%, FTSE +0.68%
• Fair Value: S&P -2.02, NASDAQ +7.50, Dow -44.25
• Total Volume: 1.8mil ESU, and 2.7k SPU traded