S&P 500 Futures: Shaky But Holding
MrTopStep | Aug 23, 2017 01:08AM ET
Monday morning, the S&P 500 futures (ESU17:CME) first print on the 8:30am CT bell was 24323.50, with a total of 235,000 contracts traded on Globex. After the open, the ES dipped down to 2421.50, then rallied up to 2426.50, before dropping below the vwap at 2423.00 and making a higher low at 2426.00. From there, the ES made a series of new lows all the way down to 2415.75, ultimately completing a MrTopStep 10 handle rule. After the low was made, the ES stutter stepped all the way back up to 2429.50 at 11:41 CT, and then sold back off down to the vwap at 2423.25 at 1:15 CT. The ES then sold off down to 2422.00, then rallied up to 2427.75 when the MiM showed over $500 million to buy.
At 2:30 CT, 1.12 million ES had traded, not bad for a slow Monday. At 2:45 the imbalance showed $360 million to buy, and went up to almost $900 million. The actual 2:45 imbalance came out $400 million to buy. Either way, the futures firmed up as soon as the MiM started showing buys. The S&P had a decent trading range with bonds up for the fourth day in a row, and the index markets eking out small gains after their biggest two-week decline of the year.
h2 S&P Up 8.5% Year To Date/h2Despite the geopolitical tensions, Jeremy Zirin, head of investment strategy Americas at UBS Chief Investment Office, said “Equity markets don’t just decline unless you have concerns that growth is going to decelerate—and there’s very little to suggest that at this point.”
MrTopStep went into the session without a real bias, but we were concerned about the start of the US / South Korea war games, and continue to be. In the end, there were modest gains across the board. The S&P 500 futures (ESU17:CME) settled at 2428.00, up +1.25 handles, or 0.05%, the Dow Jones futures (YMU17:CBT) settled at 21692, up +13 points, or +0.06%, and the Nasdaq 100 futures (NQU17:CME) settled at 5794.00, down -7.00 points, or -0.12%.
With the earnings season winding down, and a quiet economic calendar this week, the main event will be the Jackson Hole symposium, when global policy makers discuss pitfalls in removing stimulus. Janet Yellen and Mario Draghi will be under the spotlight later in the week. It could turn out to be a non-event, but we think the headline will cause some movement as central banks continue to move forward with their the policy exit after years of unprecedented easing.
h2 While You Were Sleeping/h2
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Overnight, equity markets in Asia and Europe both traded higher, led by the German DAX, which is up +0.79% this morning.
In the U.S., the S&P 500 futures opened last night’s globex session at 2428.00, and immediately printed the overnight low at 2427.50. From there, it was a steady grind higher for the rest of the night, with the high print being made at 2437.25 at around 2:00am CT. As of 7:10 am CT, the last print in the ES is 2433.00, up 5.00 handles, with 175k contracts traded.
In Asia, 8 out of 11 markets closed higher (Shanghai +0.13%), and in Europe 11 out of 12 markets are trading higher this morning (FTSE +0.69%).
Today’s economic calendar includes Redbook, FHFA House Price Index, Richmond Fed Manufacturing Index, and a 4-Week Bill Auction.
h2 Our View/h2This is a really hard game right now, but you know what? I think the ES wants to go back up. We are going to keep it simple… Our view is to buy the pull backs.
PitBull: CLV OSC -9/0 TURNS DOWN ON A CLOSE BELOW 46.12; ESU OSC -27/-7 TURNS UP ON A CLOSE ABOVE 2414.48; VIX OSC 12/14 TURNS DOWN ON A CLOSE BELOW 17.13.
Market Vitals for Tuesday 08-22-2017
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- In Asia 8 out of 11 markets closed higher: Shanghai Comp +0.13%, Hang Seng +0.91%, Nikkei -0.05%
- In Europe 11 out of 12 markets are trading higher: CAC +0.52%, DAX +0.75%, FTSE +0.69%
- Fair Value: S&P -1.09, NASDAQ +2.88, Dow -24.88
- Total Volume: 1.3mil ESU, and 783 SPU traded in the pit
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