Today started with 180k ESU and 1.2k SPU traded on Globex, trading range was 1651.40 – 1644.10. Tuesday’s regular trading hours range was 1656.50 – 1643.50 before settling at 1650.60, up 5.7 handles. We got a one-two punch of Middle East activists reporting at least 217 killed by nerve gas in Syria (*unconfirmed sources told Reuters) and Japan’s Nuclear Regulation Authority saying the leak at their radioactive water storage tank was being taken to a 3 on the 7-level International Nuclear and Radiological Event Scale. North Asia turned broadly to the red although SHCOMP squeezed into the green before lunch having been over 1% lower; the Nikkei was only slightly down on the day.
Tony_LaPorta: When I added to an ESU loser yesterday afternoon shorting NQU at 3089, I asked, show me what you got Mr. Market. I guess it was not much. Profits taken overnight in both. Sold my long Yen position. All I have left are a handful of ZBU I bought last Friday. If ZBU trades above 13113, I will be a scaled seller. If not I will obey an old rule, “Do Not Turn a Winner Into a Loser.” It has been another profitable week in August and a great August to boot. This trading game we play is all about making it and KEEPING IT. It is now time to practice the art of KEEPING IT over the last 3 days of the week and the last week and a half of the month.
Today’s pit hours opened 5 handles lower at 1646.00 -1645.00, traded an early low of 1643.50 at 8:36 before bouncing to 1648.70 at 9:04 and fading back to a series of new lows, holding 16400 at 10:50. At 9:00 existing home sales checked in up 6.5% to 5.39 million in July – 3½ year high – and by 9:15 the e-mini had a 5.5 pt trading range, offering balanced profile, 15m hi/lo is 1648.5 & 1643.5. We heard a lot of this type chatter today…@tbg4321 aka Kathy (10:25) I’m short ES, 1/4 size, only 3 units (didn’t want to trade FOMC day) entry is 1644.75, tgts 1 pt, 1641 & runner, I have scalp mentality til shown otherwise – risk is appx 2 pts til 1st scale. The U.S. market firmed a bit following the European close – FTSE closes down 1%, adding to the string of trend down days this month in the global equities. The S&P 500 grinded back up to 1646.50 area as the FOMC minutes were released.
The FOMC minutes were from the last meeting on 7/31 and the data failed to shed clarity on the tapering plan of action. We all know it is coming and the markets have been digesting the looming action and history shows us that traders as well as investors like clarity as fear and greed rule the markets. The initial price action following the release was a 10-handle selloff to 1636.50, marking a new low for the selloff from the 1705 record high over the last couple of weeks. That is about 3% from the record highs. Following the low there was a short cover, algo buy program reversal of 18 handles to a new intraday high of 1654.70 as the Dow rallied back from a 122pt deficit to going briefly green and fading back 50pts going into the closing imbalance.
redliontrader (14:35) NYSE A/D line -1.4:1 not bad and the SPU was trading 1644 area, about 11 handles off the intraday high going into the closing imbalance. The closing imbalance was creeping higher to the sell side and showed a final total of a moderate to big $625m to sell. The cash close traded 1640.40 area before trading a new intraday low of 1646.30 in the closing range before settling at 1636.50, down 14.1 handles on the day. What a reversal(s) of fortunes this afternoon while the markets digest the news…