Democrats Relent On Government Financing Bill

Charts, Commentary, News, Stocks, Technical Analysis, The Opening Print

Index Futures Net Changes and Settlements:

Contract Settlement Net Change +/-%
S&P 500 (ESH18:CME) 2835.25 +24.25 +0.85%
Dow Jones (YMH18:CBT) 26,195 +149 +0.56%
Nasdaq 100 (NQH18:CME) 6931.00 +85.25 +1.22%
Russell 2000 (RTYH:CME) 1607.00 +8.00 +0.49%

Foreign Markets, Fair Value and Volume:

  • In Asia 10 out of 11 markets closed higher: Shanghai Comp +1.30%, Hang Seng +1.66%, Nikkei +1.29%
  • In Europe 7 out of 12 markets are trading higher: CAC -0.08%, DAX +0.55%, FTSE +0.30%
  • Fair Value: S&P +1.63, NASDAQ +11.48, Dow -9.35
  • Total Volume: 1.1mil ESH & 694 SPH traded in the pit

Today’s Economic and Earnings Calendar:

Redbook, 8:55 a.m. Eastern; Richmond Fed Manufacturing Index, 10 a.m. Fedspeak: Charles Evans Speaks, 6:30 p.m. Earnings: Fifth Third Bancorp, 6:30 a.m.; Johnson & Johnson, 6:45 a.m.; Travelers, 6:57 a.m.; Procter & Gamble, 7 a.m.; Verizon Communications, 7am; State Street, 7am; Waters, 7am; Allegheny Technologies, 7:30 a.m. Kimberly Clark, 7:30 a.m.(approx); Huntington Bancshares, 7:30 a.m. (approx); Prologis, 8 a.m.; Texas Instruments, 4:01 p.m.; Canadian National Railway, 4:01 p.m.; Capital One Financial, 4:05 p.m.; Total System Services, 4:15 p.m.; United Continental Holdings, 4:15 p.m.

S&P 500 Futures: These Are Not Our Fathers Markets, And Don’t Forget It! #ES Up 6.3% In 14 Sessions

There is no such thing as the ‘old days’ anymore. Tools that used to help us make money do not work. Indicators that do work only last as long as the algo programmers can code it into their electronic trading program. We live in a brave new world where the computers run the ‘flow’, and if you get on the wrong side of it, you better get out fast.

While the S&P 500 futures (ESH18:CME) did gap lower Sunday night, down to 2802.00, they didn’t stay down long. By early Monday morning, the ES had up to 2812.00, a 20 handle bounce. The reaction to the three day government shutdown was muted both in the U.S and around the world.

Before the S&P’s opened, the Stoxx 600 was up 0.10%, and the ES was down 0.10%. On the 8:30 bell, the ES opened at 2809.50, and by 10:20 was trading 2822.75, up 11.50 handle on the day. From there, the futures pulled back down to 2816.75 before rocketing up to the 2828.00 level, up 16.75 handles. The next pullback was down to 2822.50 at 1:25 CT.

Just before 2:00, the MiM started to show over $400 million to sell, and then $600 million to sell. The MiM ‘flipped’ to sell $187 million, and then popped up to $790 million to buy on the 2:45 cash close. During that time, the ES traded all the way up to 2838.50, up 27.5 handles, or +0.80%.

Like the title of today’s Opening Print reads, these are not our fathers markets, and if you were not around in 1987, there has never been a run up like this since. Yes, the S&P exploded to new all-time highs Monday after Senate leaders said they reached a deal to end the federal government shutdown. Yes, the yield on the benchmark 10-year U.S. Treasury note rose for a fourth consecutive day to 2.663%, its highest closing level since April 2014. And yes, all three indexes notched record closes, but like we always say, the S&P tends to take bad news and makes good of it. Period. The End.

You know how we have been talking about the guys with the better seats, and how it’s the ETF’s, not the mutual funds, running the show now? Well, here is a great article by the Wall Street Journal.

Yesterday there was less than 500 million shares traded on the NYSE going into the close, and 250 million traded in the last 2 minutes of the day. If you want to know what you are up against you better read this story. When the markets do ‘crash’, who will the buyers be in the ETF’s?

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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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