Here’s What Was Interesting About The $PREM Yesterday
The December S&P 500
futures (SPZ and ESZ) opened Wednesday’s session with a +1 point gap
to the upside ahead of what turned out to be a very technical-oriented trading
session. Heavy broker selling pressured the contract off the open, allowing a
good “TICK fade” entry, for an early test of its Daily Pivot just under 1,034.
A report at 10:00 ET that Wholesale Inventories were weaker-than-expected forced
some short-covering, but as soon as the buying subsided, the contract took a
U-turn to the downside for another test of its Pivot. The contract contracted
into a 3-min triangle as it tested its Pivot a few more times before finally
cracking support and hitting the target on the 13-min bearish Butterfly posted
on Tuesday. The 3-min triangle break also formed the XA leg of a bearish
Gartley that completed around the Daily Pivot before breaking down to a new
session low and test of S1 at 1,029 (see chart). A late push into the close
gave the futures their first positive closing PREM in a few weeks, so watch for
the first move up on a gap down open on Thursday.
The December S&P 500 futures closed Tuesday’s
session with a loss of -2.25 points, and finished in the middle 1/3 of its daily
range. Volume in the ES was estimated at 658,000 contracts, which was behind
Tuesday’s pace, and right at the daily average. On a daily basis, the contract
posted a hanging man and market structure high, and also continues to form a
small cup and handle just under the September high at 1,039. On an intraday
basis, the 13-min broke the bearish Butterfly pattern and hit its target in the
1,031 area (see above) before breaking yet another symmetrical triangle.
On Thursday morning, we have the Weekly Jobless
Claims report at 8:30 am ET. Market players will be looking for any surprises
in the report that may hint at any evidence of a pick-up in labor demand.
Daily Pivots for 10-9-03
| Symbol | Pivot | R1 | R2 | R3 | S1 | S2 | S3 |
| COMP | 1898.88 | 1909.23 | 1924.68 | 1935.03 | 1883.43 | 1873.08 | 1857.63 |
| INDU | 9632.73 | 9670.19 | 9709.47 | 9746.93 | 9593.45 | 9555.99 | 9516.71 |
| NDX | 1385.93 | 1395.46 | 1408.52 | 1418.05 | 1372.87 | 1363.34 | 1350.28 |
| SPX | 1034.94 | 1038.92 | 1044.06 | 1048.04 | 1029.80 | 1025.82 | 1020.68 |
| ESZ | 1034.58 | 1040.17 | 1045.33 | 1050.92 | 1029.42 | 1023.83 | 1018.67 |
| SPZ | 1034.23 | 1039.47 | 1044.03 | 1049.27 | 1029.67 | 1024.43 | 1019.87 |
| NDZ | 1388.17 | 1398.83 | 1411.67 | 1422.33 | 1375.33 | 1364.67 | 1351.83 |
| NQZ | 1389.00 | 1400.50 | 1415.00 | 1426.50 | 1374.50 | 1363.00 | 1348.50 |
| BKX | 915.84 | 918.87 | 922.21 | 925.24 | 912.50 | 909.47 | 906.13 |
| SOX | 457.12 | 461.85 | 466.83 | 471.56 | 452.14 | 447.41 | 442.43 |
| DIA | 96.59 | 97.06 | 97.38 | 97.85 | 96.27 | 95.80 | 95.48 |
| QQQ | 34.50 | 34.77 | 35.12 | 35.39 | 34.15 | 33.88 | 33.53 |
| SPY | 103.93 | 104.46 | 104.91 | 105.44 | 103.48 | 102.95 | 102.50 |
| SMH | 37.23 | 37.89 | 38.40 | 39.06 | 36.72 | 36.06 | 35.55 |
Fair Value & Program Levels
Fair Value — (1.60)
Buy Premium — (0.72)
Sell Discount — (2.78)
Closing Premium – 1.52
Please feel free to email me with any questions
you might have, and have a great trading day on Thursday!