US Indices on Wednesday's close: SPX: (+0.54%), IXIC: (+0.95%), Dow: (+0.64%) and RUT: (+1.05%)
ES is ranging sideways and that will make short term bears and bulls nervous even if the energy on a weekly basis is clearly to the downside. There is a small series of higher lows and higher highs taking place leading into the YTD flat line. The end of day selloffs are really upsetting to many traders, but there seems to be a struggling method in play here; ES action is very mechanical/methodical now, and yesterday could be viewed as a balancing day. Close was 2651.50 and was well below the volume point of control at 2678.50. Most time was spent at 2676.25. As of this note, positioning in the overnight session is net long, though price is well below the point of control for that session, too. Weekly time frame energy is clearly to the downside some participants are fighting it. Traders are waiting for a catalyst. ESZ18 futures profile and charts here.
Heavily positive NYSE A/D Lines and breadth in yesterday's early session were sort of wild and were cut down abruptly going into the UK confidence vote. Correlation is sketchy there, though, and there were some options to do with delta hedging going on too. It was a very, very strange day if my long term memory of what constitutes 'normal'. Intervening factors include upcoming Eurozone issues, ambiguity vis the trade/china situation and of course little confidence in rallies due to the technical stature of the SPX took away most of the day's gains.
Asian equity positivity and a 10-year Treasury reopening of 24B saw ZN dropping and widening spreads. There is a 16B long bond auction today. With treasury dumps/QT over for this week. This could loosen things up a bit.
VIX static, VVIX declining and SKEW still muted.
ECB rate decision and press conference a few hours away...some are hoping for a dovish flourish and some form of compensation for a risk asset tinder box in a dry/low liquidity (QT) environment. Academic economists have a holistic view of the world and may try to compensate for the foibles of certain world leaders. I am suggesting that the central banks of the world - coordinated in a way that politicians are not - are in high caution mode with visions of meltdowns in their heads. SPXweekly view.
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