The day started with 2.2k SPUs and 285k ESUs traded on Globex and the disappointing 7:30 release of personal income. The RTH opening range was 1264.00 to 1264.70 followed by a quick drop to 1262.00 LOD. After a few initial sell programs the SPU regained its footing and rallied to 1268.80, sold off a few handles and at 9:30 was making new highs at 1273.30. A firmer NASDAQ and the EC up 200 off the lows added support to an over sold market. After the initial sell off the SPU took out buy stops and ran buy programs all day. We put this out on the IM: mrtopstep (Jun-27 08:50:42 AM): oversold + quiet = up and mrtopstep [Jun-27 09:26:37 AM]: 10 handle rule in effect 1262 to 1272. Then the sideways trade ensued as the SPU held 1269 area before stepping back up to new highs at 1274.60 1275.20, 1278.50, and the HOD 1280.00 around 1:49CT. As 1277 area was trading the 2:46 imbalance showed overall MOC (15:45:23) $ 265.99 M / -1,335.84 M – over $1bil for sale. On the 3:00 cash close the SPU traded 1274.70 before settling at 1276.30’s.
After weeks of failed Mutual Fund Mondays the S&P and NASDAQ had a big rally. Over the next few months we are going to start really breaking down the volumes so you understand exactly what we are looking at. If you think the volumes are bad now just think what they will look like during the Dog Days of Summer when half the crowd is not trading and the other half is on vacation. You heard it here first… less will be better in the coming months!
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