Futures: Opening Print and S&P Levels to Watch
The Asian markets closed mostly lower and Europe is mixed. Today starts with seven economic releases, a 7-year Note auction and Jeremy Stein and Narayana Kocherlakota speaking from the Fed. After its fifth down day the S&P may look bad. But watch out, the buy stops are building up again.
When your P&L is going well and turning consistent profits it's a new Porsche and vacations in the Caribbean. Or at least the possibility. When you're losing, you're worried about when the losing streak is going to end and question why you do this.
Profits and losses start with attitude.
We study patterns and premium levels and try to derive as much information as we can before making a trade. And part of that information is mastering our thoughts and emotions. It's part of the job. You have learned to more patient. If you don't catch the top, let the sell program exhaust itself and look to be a buyer. If it's timed right you can lower your risk.
The S&P is at a threshold, down five days in a row: Sept. 19 (-.40), Sept. 20 (-15.0), Sept. 23 (-9.7), Sept. 24 (-.20), Sept.25 (-6.7). While the losing streak is clear to see, the size of some of the down days are fractional, not even a full handle. When you add the net changes up and divide it by five, the average down day is 6.4 handles. The current sell off is not a drop off a cliff; it's more of a gentle downward slope. Wile E. Coyote isn't even bruised.
The overall price action in the E-mini S&P (ESZ13) is one of failed rallies and sell programs right now. Yesterday we questioned whether the S&P could close lower five or six days in a row and we said no. We also said we did not think the S&P could go down all week and we still feel that way.
Many times after the S&P makes a fresh contract high it pulls back 30 to 40 handles off the high; 1685 is exactly 40 handles. Four instances of the MrTopStep 10-Handle Rule.
As always, use stops and keep an eye on the 10-handle rule. Don't forget to catch MrTopStep on The Closing Print video. We report directly from the SPX pits, wrapping up the day and positioning for trade tomorrow.
OptionsProfits can be followed on Twitter at twitter.com/OptionsProfits
MrTopStep can be followed on Twitter at twitter.com/MrTopStep
For LIVE futures chat, more information on the 10-handle rule and futures educational content CLICK HERE FOR A SEVEN-DAY FREE TRIAL.
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass + 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV