Here’s What Yesterday’s Open Interest Says
The December S&P 500
futures (SPZ and ESZ) opened Thursday’s session with a -3.25 point
gap to the downside, despite better-than-expected earnings from CSCO and the
lowest Jobless Claims number in 2 1/2 years. After chopping lower the first 2
hours, the contract simply seemed to run out of sellers around S1, and clawed
its way up off its lows. Going into the last hour, we saw a repeat of Wednesday
as the contract was able to find some volume again that propelled it through
Wednesday’s high and to a new session high at 1,056.50. A pullback into the
equities market close was met by more buying to push the futures to a new high
in the last 15 minutes.
The December S&P 500 futures closed Thursday’s
session with a gain of +5.00, and finished just off the high of the session.
Volume in the ES was estimated at 618,000 contracts, which was ahead of
Wednesday’s pace and above the daily average. Open interest declined on
Wednesday’s move, indicating that more longs took money off the table into daily
resistance, so we’ll see if Thursday’s move attracted any new money. On a daily
basis, the contract’s 10-day MA has crossed up through the 20-day MA to provide
some lifting support, however, divergence continues to form as the contract
faces Monday’s high at 1,060.50. On an intraday basis, the 13-min chart broke a
cup and handle that was subsequently and simultaneously confirmed by 60-min and
30-min triangle breakouts (see chart).
On Friday morning at 8:30 am ET, all eyes will be
watching for the October Unemployment report. The consensus estimate is for the
rate to come in unchanged from September at 6.1%, however, market players will
be looking for a better number based on the better Jobless Claims numbers. Have
a happy and safe weekend!
Please feel free to email me with any questions
you might have, and have a great trading day on Friday!
Chris Curran
chrisc@tradingmarkets.com