What Happened?

Index Futures Net Changes and Settlements:

Contract Settlement Net Change +/-%
S&P 500 (ESZ18:CME) 2701.75 -89.00 -3.18%
DowJones (YMZ18:CBT) 25,046 -800 -3.09%
Nasdaq 100 (NQZ18:CME) 6803.25 -255.00 -3.61%
Russell 2000 (RTYZ17:CME) 1481.90 -65.90 -4.25%

Settlements from Tuesday 12-04-2018

Foreign Markets, Fair Value and Volume:

  • In Asia 11 out of 11 markets closed lower: Shanghai Comp -1.68%, Hang Seng -2.47%, Nikkei -1.91%
  • In Europe 13 out of 13 markets are trading lower: CAC -2.22%, DAX -2.43%, FTSE -2.12%
  • Fair Value: S&P +0.55, NASDAQ +4.04, Dow +11.02
  • Total Volume: 2.69mil ESZ & 951 SPZ traded in the pit

As of 8:00 AM EST

Today’s Economic Calendar:

Today’s economic calendar includes the Weekly Bill Settlement, 8-Week Bill Settlement, 52-Week Bill Settlement, Challenger Job-Cut Report 7:30 AM ET, ADP Employment Report 8:15 AM ET, International Trade 8:30 AM ET, Jobless Claims 8:30 AM ET, Productivity and Costs 8:30 AM ET, PMI Services Index 9:45 AM ET, Factory Orders 10:00 AM ET, ISM Non-Mfg Index 10:00 AM ET, Quarterly Services Survey 10:00 AM ET, EIA Petroleum Status Report 11:00 AM ET, Raphael Bostic Speaks 12:15 PM ET, Treasury STRIPS 3:00 PM ET, Fed Balance Sheet and Money Supply 4:30 PM ET, John Williams Speaks 6:30 PM ET, and Jerome Powell Speaks 6:45 PM ET.

S&P 500 Futures: Shit Hits The Fan

Chart courtesy of @Chicagostock $NQ_F Nasdaq lower highs on failure to overcome 6M reversal window 7160. Dec 3 trading range key. New resistance to overcome to squeeze shorts up to 7400. Failure to over come D3 keeps pressure lower.

Volatility in the U.S. stock markets continue. Late last week construction spending for October was reported as being down month over month, a miss of expectations. In addition to this, last Thursday’s weekly jobless claims were higher than expected, and now showing upward momentum not seen since 2011.

However, before the markets could turn bearish, there was a report that Trump and Chinese leaders were going to negotiate regarding the tariffs, and other factors in the “trade wars”, that caused the U.S. stock markets to make a huge jump Monday morning, before turning on the “sell the news” response as doubts increased regarding the legitimacy of these trade talks.

As the week got under way, it became clear that talks failed, which Tuesday turned the stock markets lower as the major indices were all down more than 3%. The small cap Russell 2000 was down more than 4%, also down more than 4% were the DJIA Transportation sector which is considered a leading barometer.

With the markets closed yesterday due to the state holiday for the mourning and funeral of former President George H.W. Bush, the financial circumstance was quiet. However, during the day it was discovered that the executive of a Chinese company with ties to China’s government had been arrested, and this lead to serious rhetoric charged at the U.S.,and an expression of fear from potential travelers to China.

When the U.S. index futures opened up last night at 6:00 EST there was an extreme amount of selling in the opening minutes, and the CME Group, the exchange for the futures markets, said they had to intervene to keep the markets from a considerable tumble.

As of 7:00 CT, the S&P 500 and Nasdaq futures are trading down by 2%, or more. We don’t know how the day will look, but at the time of this writing it appears that the S&P 500 large caps, S&P 400 midcaps, DJIA, and Russell 2000 small caps will all open today’s session in negative territory once again for 2018, while the Nasdaq is up only slightly for the year.

Given this, our concern is that money managers could be tempted to finally throw in the towel for a scratch on the year, or with small losses, and move on to 2019 rather than explain to customers why they held onto stocks that were tanking into the end of the year.

MrTopStep advises traders to be careful out there, to trade small, and to stick to good rules and common sense risk principles.


As always, please use protective buy and sell stops when trading futures and options.

Disclaimer: Trading Futures, Options on Futures, and retail off-exchange foreign currency transactions involves substantial risk of loss and is not suitable for all investors. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge, and financial resources. Any decision to purchase or sell as a result of the opinions expressed in the forum will be the full responsibility of the person(s) authorizing such transaction(s). BE ADVISED TO ALWAYS USE PROTECTIVE STOP LOSSES AND ALLOW FOR SLIPPAGE TO MANAGE YOUR TRADE(S) AS AN INVESTOR COULD LOSE ALL OR MORE THAN THEIR INITIAL INVESTMENT. PAST PERFORMANCE IS NOT INDICATIVE OF FUTURE RESULTS.

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