SP500 in the hammer zoneSP500 reached a strong reversal area where price reacted in the previous week. I was expecting a little pump in my previous ideas, and honestly i wasn't expecting it to rise so much. But i am holding my short trades and i am adding more here, consider i expect a selloff this month. First target the support zone at 4990
Sp500future
ES (S&P500)... Expecting a short term BULLISH Move!Bearish, but expecting
a short term bullish move.
Price has reached the
4th standard deviation,
swept the LRLR, then
mitigated the +OB. The
expectation now is an
External -> Internal LQ
move.
Wait/watch for signs of
reversal from the current
poi.
I enjoy any feedback or questions in the comment section.
All opinions are welcome!
LIKE or BOOST this post, if you would. I would be appreciate it.
SUBSCRIBE if you want to catch all of my future postings!
SP500 H4 Projection Price is clearly in a bearish trend. Price also has fair value gab and unmitigated order block zone. So initiate short positions near the order block zone after finding a strong bearish price action structure. Analysis trend is invalid if the price breaks and closes above the trendline. Good Luck.
SP500 Expecting a dropI think SP500 is on the way to perform a great drop. Looking on H4 timeframe we can see a clean break below main trendline and a retest of it. I think today we will see some volatility around the beginning of the NY Session. I expect a fake moves first to the upside to grab some liquity, next we should see a drop till support zone around $5130
S&P500 Futures Analysis - Continuous, Just as the Markets !This is a Thread, so Follow for Technical Analysis performed with TrapZOne Pro & UMVD Indicators.
* Trend is Based on TrapZone Color
* Bar Colors give us Momentum Green from strong Up Moves. Red Bars point to strong Down Moves.
* Red UMVD = Selling Pressure & Green UMVD = Buying Pressure. Purple is for Divergence = Battle of Supply & Demand
--------------------
1-15-2024
Downtrend with UMVD showing Divergence. Price sliding as US MSI also points to weakening in the market. Hold On to You Hats I Say :)
SPX/S&P 500 FUTURESHello fellow traders, Understanding the current markets are awful as of the this year, price suddenly sky rocket like a balloons on space.
My idea is base on Distribution since the COVID 2020 fall of -35%, the price retrace back for 3 years on the run with almost 45% if price goes to my analysis atleast 4966$.
Then we might see a fall or Down back to the COVID 2020 fall.
This is only my view, Not executing unless price reach 4966, maybe next month or end of the month, We have FED/FOMC in the last day of the month.
Trade at your own risk. position yourself at higher possibility .ofcourse this idea has better odds on making a short positions.
This is not a financial advice.
Follow for more higher context. Swing trades. Stay safe folks.
SPY when stars align!as i was helping someone better understand some of these terms, like golden pocket...
actually ill skip it. okay the SPY, everyone's favorite!... (to play 0dtes on) jk, i do it too sometimes.
This is a great example of a "high probability set up" . when you have multiple indicators pointing to the same thing.
we have not 1 not 2 not 3 but 4! indicators all lining up to a single area (when stars align, ahh) and it just so happens to be the area we were aiming for before we started charting. ADD CONVICTION
1. Previous S/R level & high volume area
2. Golden Pocket
3. Unfilled Gap
4. 50 Day Moving average
all lining up to the same key zone, that 402.50 area. im not saying we get there tomorrow or the next day, we could never see it again nothings for sure. but if we do this is a critical level of support. because if it holds, that's still a higher low on the daily and weekly time frame. what am i watching for this week? that 406.15 call it 406 to 407.50 area im watching to see if that holds support, or if we break through it and go down to test that 404.50 area. and if thats broken then im targeting 401.50 to 402.50/403.
Upside targets - almost every dollar is resistance and major major resistance around 417-422. 412 to 413.75 if we can get above that we could see alittle higher in the short term, im leaning slightly bearish to neutral. i want to see how the rest of the bank earnings affect the market this week. okay im tired and had to type this 3 separate times as this started with me showing a friend what the golden pocket was and how to use a basic fib. happy trading this week. cheers
New Top, Old Resistance: Mixed News Question Bullish SupertrendNew Top, Old Resistance: Mixed News Question Bullish Supertrend
Dear Esteemed Traders,
TECHNICAL ANALYTICS
Zooming out on the chart, ES hit a level that might be a resistance since January 2022, formed by a previous top. Historic tops often act as a resistance. Alone this would be a weak indication, but the price managed to hit that level at the same time when it also met the rising resistance from historic bottoms. See the red line on the chart.
I can observe double bearish signals on a bullish super trend, in which the price seems to have crossed down together with the EMAs in the previous month. I wouldn't call super trend bearish yet, but the so far strong bullishness of it became questionable.
MACD made a bearish cross and made a journey towards the bearish side of the indicator below the price chart.
RSI went extremely negative after an extended period spent in the upper half of the indicator. It means that ES might have been overbought, and the market signals the start of a correction to this overboughtness.
The possible correction move paired with a volume that matches the buy volume candles of the mentioned rally. This volume profile further powers the idea that the people who have been buying ES since October might feel the level to take profit on their investments.
The Money Flow Index (MFI) at the bottom and Bull-Bear Power (BBP) above it share the bearish view. BBP isn't too bearish, but it's been showing a weakening bullish power since December.
Finally, the $4736 support seems to be holding up the market from crashing. If the support breaks, the price can fall to the next support. I observed a support of around $4600.
These are the analytics, I found, but let's consider news trading.
NEWS
The Federal Reserve has signaled its intention to raise interest rates in an effort to combat inflation. This could weigh on stocks, as higher interest rates can make borrowing more expensive for businesses and consumers.
Recent economic data has been mixed, with some indicators showing signs of slowing growth. This could raise concerns about the health of the economy and further dampen investor sentiment.
Earnings season is underway, and some companies have reported disappointing results. This could lead investors to expect lower earnings growth overall, which could put downward pressure on stock prices.
In total, I wouldn't call ES straight bearish, but I claim the bullish trend to weaken and I'm looking for shorts below the $4736 support line.
Greetings,
Ely
US Equities 2024 OutlookCME: E-Mini S&P ( CME_MINI:ES1! ), E-Mini Nasdaq ( CME_MINI:NQ1! )
Stock investors around the world had a banner year in 2023. Of the ten major stock market indexes I monitor, eight delivered solid 1-year returns.
• North America: S&P 500, +23.9%; Nasdaq Composite, +53.6%;
• South America: Bovespa (Brazil), +22.3%;
• Europe: FTSE (UK), +3.0%; Stoxx (Germany), +11.3%;
• Asia: Nikkei (Japan), +28.2%; Kospi (Korea), +18.7%; Nifty (India), +19.5%;
• China: SSE (Shanghai), -3.2%; Hang Seng (HK), -13.7%.
In this second installment of new year outlook for major asset classes, I will discuss what opportunities may lay ahead for US stocks. Subsequent writings will cover Energy, Agricultural commodities, Interest Rates, Forex, and Cryptocurrencies.
FYI: The last writing was a year-end review for metal commodities – Gold, Copper, and Aluminum. If you haven’t read it yet, you may follow the link here:
Record Gains Built from Lower Baselines
While all four major US stock indexes booked double-digit returns in 2023, they each experienced a steep loss in 2022. The combined 2022-2023 returns aren’t so impressive.
• Dow Jones: +5.3%
• S&P 500: +3.3%
• Nasdaq 100: +9.3%
• Russell 2000: -5.9%
You may think that adding the 2022 return of -18.1 and 2023 return of 23.9% will give the S&P a 2-year return of +5.8%. But the actual return is only +3.3%. Why?
Simple Math: If you lose 20% first, you will need to gain 25% to make up for the loss and just get back to square one. Mathematically, 1/0.8 = 1.25, or (1-20%) * (1+25%) = 1.
This matters a lot to hedge funds. An active manager may have a 2-20 arrangement with his investors, which is 2% fee on asset-under-management, and 20% on carry interest. If a fund closely tracks the Nasdaq, the manager received no carry for 2022, and the carry for 2023 is based on the 2-year return of +9.3%, not the 2023 return of 53.6%. The fund usually would have a “high water mark” clause that requires the manager to make up for prior loss before getting paid. Therefore, Wall Street bonuses may not be that big this year.
2024 Outlook for US Equities
The December 26th CFTC Commitments of Traders report (COT) shows that:
• E-Mini Dow: “Asset Manager” has 26,070 long positions and 3,098 short positions.
• E-Mini S&P 500: Asset Manager has 1,147,149 longs and 275,037shorts.
• E-Mini Nasdaq 100: Asset Manager has 111,046 longs and 20,662 shorts.
• E-Mini Russell 2000: Asset Manager 229,229 longs and 142,312 shorts.
The overwhelmingly Net Long positions on all major US index futures indicate that futures traders are very bullish on US equities. Investors eye in a soft landing for the US economy and expect aggressive rate cuts by the Federal Reserve.
According to CME Group’s FedWatch Tool, the first rate-cut could occur at the March 20th Fed meeting, with a 73.5% probability. For June 12th, the odds of two or more rate cuts increase to 82.2%. By December 18th, investors expect the Fed Funds rate will be 1% to 2% lower than the current 5.25-5.50% range, with 98.5% odds (Data as of January 1st).
(Link: www.cmegroup.com)
US equity indexes could stay high as long as the Fed remains dovish. The past few months proved that investors are very resilient. The bullish market sentiment is very hard to break, unless really bad things happen.
If an investor owns US stocks, there is no good reason to sell them now. We have seen that geopolitical risks had done little damage to US equities. Fed policy still drives the market. Staying with the ride and hedging the stock portfolio with put options may be a good strategy.
Trading with CME E-Mini Equity Index Put Options
As US equity indexes take turn making all-time high, it’s costly to buy the underlying stocks. Options are an inexpensive alternative to get exposure in stocks. Depending your stock portfolio and views, you could either long or short the options on E-Mini S&P 500 futures
• Last Friday, the March E-Mini S&P 500 futures (ESH4) was settled at 4,812.75. Buying 1 long or short position requires initial margins of $11,800;
• January end-of-the-month (EOM) Call options with a 4910-strike costed 23.50 points. Premium for 1 call is $1,175 (= 23.5 x $50 multiplier);
• January EOM Put options with a 4710-strike priced at 27 points. Premium for 1 put is $1,350 (= 27 x 50).
We could construct a similar strategy with E-Mini Nasdaq 100.
• Last Friday, the March E-Mini Nasdaq futures (NQH4) was settled at 17,003.75. Buying 1 long or short position requires initial margins of $17,700;
• January end-of-the-month (EOM) Call options with a 17,200-strike costed 208.50 points. Premium for 1 call is $4,170 (= 208.50 x $20 multiplier);
• January EOM Put options with a 16500-strike priced at 127.70 points. Premium for 1 put is $2,551.40 (= 127.75 x 20).
In a rising market, out-of-the-money put options could be a strategy for small odds with big payoff. In January, we will have new data releases for December inflation (CPI and PCE) and nonfarm payroll employment, as well as a Fed meeting on January 31st.
My reasoning: If we see inflation rebound, stronger employment, or a hawkish Fed, the stock market could turn south, resulting in a gain for the put.
Hypothetically, if the March S&P futures price drops 150 points by January month-end options expiration, the put would be 47.25 points in-the-money (= 4710 – 4,662.75) and earn $2,362.5 (= 47.25 x $50). Using the initial margin as cost base calculations, the theoretical return would be 75% (= 2362.5 / 1350 - 1).
If the March Nasdaq drops 800 points (17,003.75-800=16,203.75) at January options expiration, the put would be 296.25 points in-the-money (= 16,500 – 16,203.75) and earn $5,925 (= 296.25 x $20). The theoretical return would be 132% (= 5925 / 2551.4 - 1).
On the other hand, if stocks continue to rise, put options will lose money, but never go beyond the premium already paid.
Options Calculator is a free tool CME Group provided for options traders. It generates fair value prices and Greeks for any of CME Group’s options on futures contracts or price up a generic option with this universal calculator. Traders could customize their input parameters by strike, option type, underlying futures price, volatility, days to expiration (DTE), rate, and choose from 8 different pricing models including Black Scholes.
www.cmegroup.com
Happy Trading.
Disclaimers
*Trade ideas cited above are for illustration only, as an integral part of a case study to demonstrate the fundamental concepts in risk management under the market scenarios being discussed. They shall not be construed as investment recommendations or advice. Nor are they used to promote any specific products, or services.
CME Group Real-time Market Data help identify trading set-ups and express my market views. If you have futures in your trading portfolio, you can check out on CME Group data plans available that suit your trading needs www.tradingview.com
Weekly Macro S&P 500 AnalysisThe 4270.00 level can contain selling through Q1, above which 4634.50 remains a 3 - 5 week target, 4864.25 likely over the next 3 - 5 months.
Upside, 4634.50 can contain weekly buying pressures, while closing above 4634.50 indicates the targeted 4864.25 by the end of February where the market can top out into Q2.
Downside, a settlement below 4270.00 signals 4113.50 within 2 - 3 weeks, secondary long- term support able to contain selling into later in 2024 and above which a longer-term bullish dynamic remains in effect over that time horizon.
1-Treasury bills give the same returns as S&P 500 with less riskWall Street Investment banks are predicting various prices for the S&P 500 close at the end of 2024. But if the current 1-year Treasury Bill Yield is the same as the estimates then why bother buying the S&P 500? It would be safer buying bills and you may get an equal return.
This piece of analysis will look at:
Historical accuracy of Wall Street Banks S&P 500 estimates for the year ending
Current predictions for S&P 500 estimates for year-end 2024
The current yield on 1-year Treasury Bills
Comparison between the estimates for the S&P 500 vs. 1-year Treasury bills.
Historical analysis
According to research done by Bespoke Investment Group and by CNBC.
Excluding 2008, the analyst overshoot of the S&P 500 actual performance over the past 15 years goes down from being over 9% off to a miss of 3.4%. And the fact that analysts overshot the actual market performance 12 out of 15 times, means they did undershoot it three times. When looking at their S&P 500 price target prediction, analysts undershot the actual performance in seven of the past 20 years.1
Historically, these forecasts have often underestimated the actual market performance, especially during the bullish period since 2009, when they were off target seven out of nine times. The average annual projection tends to be around 9.3%, aligned with the S&P's historical average gain. 2
So, overall, excluding the outlier of 2008, analysts tended to overshoot their predictions of the S&P 500 performance by a decreasing margin over the past 15 years, moving from an initial overestimation of over 9% to a more moderate miss of 3.4%. Their track record shows a pattern of overshooting the market's actual performance in 12 out of 15 instances, with just three instances of undershooting.
Current predictions
BMO Capital Markets: $5,100
Deutsche Bank: $5,100
RBC Capital Markets: $5,000
UBS: $4,700
Goldman Sachs: $5,000
Bank of America: $5,000
Barclays: $4,800
Wells Fargo: $4,600
Morgan Stanley: $4,500
J.P. Morgan: $4,200
Average = $4,800
Median = $4,900
Mode = $5,000
1-Year Treasury Bill
The current yield on the 1-Year Treasury Bill is 5.061%. The reasons for the yield being somewhat high are:
Strong Economic Data: The resilience of the U.S. economy, especially the robustness of the jobs market, has surprised many experts. Despite expectations for a slowdown, the economy continues to perform well, leading to higher yields. The Federal Reserve's cautious approach to cutting interest rates too quickly is another reflection of this strong economic backdrop.
Fed's Cautionary Stance: The Federal Reserve is wary of cutting rates swiftly due to concerns about inflation and the tightness of the labour market. They aim to maintain a balanced approach, keeping rates at a level that won't spur excessive inflation but also won't hinder economic growth.
The shift in Fed Messaging: Recent messaging from the Fed indicated less aggressive rate cuts in the future than previously expected. This change in outlook, particularly with the Dot Plot showing fewer rate cuts in 2024, has influenced bond market sentiment.
Increased Treasury Issuance: The U.S. Treasury's substantial pace of issuing new debt has disrupted the supply-demand equilibrium in the bond market. The unexpected announcement of raising a significant amount of money through bond sales has added pressure to yields as more bonds flood the market.
Yield Curve Dynamics: The yield curve, which had previously inverted (short-term yields higher than long-term yields), is now experiencing a lessening of this inversion. Typically, this occurs as short-term rates fall while long-term rates rise. However, the current situation is unique as the long-term yields are increasing while short-term rates remain relatively stable.
The surge in Treasury yields reflects a confluence of factors: a resilient U.S. economy outperforming expectations, the Federal Reserve's cautious approach to rate cuts amid concerns about inflation and a tight labour market, a shift in Fed messaging signalling fewer future rate reductions, increased government borrowing, and the unique dynamics of the yield curve. This unexpected rise in yields diverges from earlier predictions of a decline, shaping the current landscape of the bond market and influencing borrowing rates for consumers and businesses alike.
One's prediction of the future yield in a year may be higher or lower. But regardless, when you buy a bond it is stuck at that yield since it represents the interest earned.
S&P 500 vs Treasury bills
Yesterday's close of the S&P 500 was $4,567.18. If we assume the S&P 500 will reach the average and median estimates that represents a 5.10% and 7.13% return on investment respectively.
However, as we have established above looking at the historical analysis of Wall Street estimates they tend to overestimate. Most of the time the S&P 500 closed below their estimate. Wall Street estimates between 2000 and 2018 have an average overshoot of 4.40% from the table above. So there is reason to assume they will do the same this year.
If we assume the estate's average and median return of 5.10% and 7.13% respectively are overshooting. That means we might as well invest in 1-year Treasury Bills. Why? Because Treasury bills are safer, and guaranteed return and if they are giving similar returns to the more risker S&P 500 over the next year then why bother with the risker alternative? It makes more sense to just buy 1-year Treasury Bills.
Conclusion
In the landscape of investment choices for the year ahead, the comparison between the S&P 500 and 1-year Treasury Bills offers compelling insights. The historical analysis of Wall Street's predictions demonstrates a consistent pattern of overestimation, signalling a potential trend that might repeat itself in the current estimates for the S&P 500 for year-end 2024.
With the current projections showcasing potential returns for the S&P 500, it's crucial to consider the safety and reliability offered by 1-year Treasury Bills, especially given their current yield, standing at 5.061%. The compelling argument arises when assessing the historical trend of overestimation by financial analysts in forecasting S&P 500 performance.
If these estimations continue to overshoot, as historical data suggests, the seemingly safer investment in 1-year Treasury Bills could provide comparable returns with considerably lower risk. The prudent approach might lean toward the Bills, given their guaranteed return and stability, particularly if they yield similar or better returns than the potentially riskier S&P 500.
The choice between the S&P 500 and Treasury Bills becomes a contemplation of risk versus stability. While the S&P 500 might offer potential gains, the historical trend and current projections invite consideration of the Bills as a safer and possibly equally rewarding investment option for the upcoming year. Ultimately, it might be prudent for investors to weigh these factors carefully before making their investment decisions for the year ahead.
1
www.cnbc.com
2
seekingalpha.com
S&P500 (@ES @MES)We are currently in an upwards rally in the markets
With a trend fib being pulled from our larger lows we have a coinciding level of the 50% retracement converging with the top line of our rising wedge which is a bearish pattern (depending on how long this march takes we could meet our golden ratio 61.8% at the top of our wedge creating a yearly double top as a possibility also).....this is purely up to how fast we continue to move higher
We must assume price will continue to respect this rising wedge (which is a bearish pattern which breaks to the downside 65%+ of the time)
If we break out to the upside we can see a 61.8% retrace and grab a nice throw over or we have a blast of scenario and we march to new all time highs we must wait and see
But for now i am expecting a pull back once we hit our 50% fib
S&P500 Hello Traders!
Today I am focusing on the S&P500's next move and considering that we are approaching the Christmas period and that I am expecting a year-end bullrun towards 4700 I believe that at the moment the index could retrace towards 4525 with a maximum extension towards 4485 to load some long positions at better prices and then restart towards the highs.
Targets are determined by fibonacci's retracement, let us consider the period of the extension of the last restart until exhaustion.
Targets are the levels between 4525-4485.
Thanks.
Emini S&P500 LONGStill holding e-mini S&P long. Took a second entry at 4326.75 and moved stops below pivot point strong support @ 4315.5 I am looking for upside swing targets: Swing Target 1 =4415, Swing Target 2 =4431.25 and Swing Target 3 =4457.50
Regular session Targets:
TP1: 4357.50
TP2: 4373.50
TP3: 4383.75
TP4: SwT 4430
TP5: SwT 4457
E-mini S&P500 Long Double Bottom/Bullish OrderblockLooking for Market to find Support in Bullish Orderblock... Market could probe lower coming into market close ahead of Tesla Earnings, however, if market is going to hold it should hold right here. If earnings are good, market will be bullish. If earnings are bad, market will be bearish and we will be folding lower...
⚠️This idea is for informational purposes only and should not be considered as financial advice. Trading involves risk, and past performance is not indicative of future results. Always conduct your own research and consult with a qualified financial advisor before making any investment decisions. ⚠️
SP500 Futures new Supply Zone (?)Hello trading community!
The ES Futures seems to be Bearish, and we can watch in this chart 3 Higher Lows created. A strong support that was tested three times has already been crossed and tested to create a new possible resistance.
The Dollar continue to show strength, the DXY is again testing the resistance, and we believe this time will be a strong long signal.
Also, after analyzing the SPX timeframe 4Hours, is possible to observe the Supply area that has already been tested and originated the three HL.
SPX is entering in an area that was resistance some months ago.
To conclude, we believe ES Futures contracts will test again the area of the new resistance 4401.25, and will change the direction to a short position