Good morning traders! Welcome back to a shortened trading session. We aren't taking today off but it will be a light day for us with just a couple of adjustments and no new adds to the portfolio. Shortened days like this don't happen often but I've found the the risk/reward for 0DTE's is not very good. Tomorrow the market is closed so we'll be back Friday to hit it hard. Yesterday was a good day overall. 

I added another column to our results matrix for notes and potential gains. We've been doing small event contracts setups that are very asymmetric in nature. They usually come in around 200%-800% ROI potential but are very low probability trades. Statistically these types of setups will lose money 90% of the time but one win puts you nicely in green. 

A Labor Department report on Tuesday showed that U.S. JOLTs job openings unexpectedly rose to 8.140M in May, stronger than expectations of 7.960M.  
Federal Reserve Chair Jerome Powell said Tuesday that recent economic data indicate inflation is returning to a downward trajectory, but stressed that policymakers require additional evidence before reducing interest rates. While Powell refrained from offering any specific guidance on the timing of the first rate cut, he acknowledged that the central bank has made “quite a bit of progress” in lowering inflation. He added that he would like to see that progress continue. “Because the U.S. economy is strong and the labor market is strong, we have the ability to take our time and get this right,” Powell said. “And that’s what we’re planning to do.”
U.S. rate futures have priced in an 8.8% chance of a 25 basis point rate cut at the next central bank meeting in July and a 59.9% probability of a 25 basis point rate cut at the September FOMC meeting.
Meanwhile, the U.S. stock markets will close early at 1 p.m. Eastern Time today and remain closed on Thursday for the Independence Day holiday.
Today, investors will closely monitor the release of the Federal Reserve’s minutes from the June meeting, which may provide further insights into the policymakers’ views on inflation, interest rates, and the economy. 
On the economic data front, all eyes are focused on the U.S. ADP Nonfarm Employment Change data, set to be released in a couple of hours. Economists, on average, forecast that the June ADP Nonfarm Employment Change will stand at 163K, compared to the previous number of 152K.
Also, investors will focus on U.S. Initial Jobless Claims data. Economists estimate this figure to arrive at 234K, compared to last week’s number of 233K.
The U.S. ISM Non-Manufacturing PMI and the U.S. S&P Global Services PMI will be closely watched today. Economists forecast the June ISM Non-Manufacturing PMI to stand at 52.6 and the June S&P Global Services PMI to be 55.1, compared to the previous values of 53.8 and 54.8, respectively.
U.S. Factory Orders data will come in today. Economists foresee this figure to stand at +0.2% m/m in May, compared to the previous figure of +0.7% m/m.
U.S. Crude Oil Inventories data will be reported today as well. Economists estimate this figure to be -0.400M, compared to last week’s value of 3.591M.
In addition, market participants will be anticipating a speech from New York Fed President John Williams.

We had a strong finish going into the close yesterday but nothing effectively has changed. SPY and QQQ are still stuck at ATH's and the IWM is still struggling to get above its 50DMA while the DIA treads water. 

Looking at the VTI, which I use to get a broader view of what the "market" is doing, we see the consolidation continue. No real signal here. 

There are however, some areas for concern. ​The 10-year note yield is now up over 20 basis points in since Friday's intraday low. That's 20 basis points in a matter of hours without any material news. For the first time in almost 5 weeks, the 10-year note yield is set to break above 4.50%. Bond markets are trading like rate cuts got cancelled and inflation is on the rise. Are bond markets telling us something?

This is also of concern. ​This is quite an unusual setup: while the S&P 500 has moved up, the percentage of S&P 500 stocks above their 50-day moving average has dropped.

​In the last 4 instances when the % Yield Curve Inversion has gone above 70% and then back to 50%, we saw massive drawdowns for the index.

Once again, I'm not predicting a crash. I have no idea when or by how much we reverse but...reversals do happen. 

No intra-day levels for me today as I'll be skipping any new 0DTE setups.
I hope you all have a nice break. Go do something fun and be safe. I'll see you all Friday! 

Welcome back! We had a decent day yesterday. This is what I consider to be one of the toughest weeks of the year to trade. When I was on Wall Street it was the week that most traders took off. With Weds. being a half day and Thurs. having the market closed, most traders would take Friday off as well. If you hone in on the volume of the SPY you'll see it's about as low as it's been all year.

I.V. is off. Volume is down at 67% of avg.. Shortened week. We do have NFP on Friday which may give us some action but otherwise it's generally not a great week for traders. Here's our results from yesterday.

We did book a profit early this morning on our Theta fairy of $392 dollars for the two day hold. Almost double what we look to make. This is one area that seems to be working for us.

​Lets take a look at the markets. Mostly weakness yesterday with the poor IWM slipping back below the 50DMA.

Futures this morning are indicating a slight sell signal. 

This Friday’s nonfarm payrolls report is expected to be a “goldilocks” report, with 200,000 jobs created and a steady 4% unemployment rate.
But even a minor deviation from the consensus could be noteworthy. This year, headline payroll gains have been solid, with an average monthly increase of 255,000 jobs.
Yet, in that same time, the unemployment rate has risen from 3.7% to 4%. It’s up even more from its post-Covid low point of 3.4% reached in January and April of 2023.
The nonfarm payrolls data and the unemployment rate come from two separate government surveys—the payroll survey and the household survey, respectively.
While the payroll survey has been showing strong job gains this year, the household survey hasn’t. No jobs have been added this year based on the household survey, compared to 1.5 million for the payroll survey.
Divergences in the two sets of data aren’t unusual, and the Bureau of Labor Statistics lays out several reasons why it happens, from sampling error to benchmark revisions to “off-the-books” employment.
In general, investors tend to favor the nonfarm payrolls report when gauging the health of the U.S. jobs market.

Economic data on Monday showed that the U.S. ISM manufacturing index unexpectedly fell to a 4-month low of 48.5 in June, weaker than expectations of an increase to 49.2. Also, the U.S. June ISM price paid sub-index fell to a 6-month low of 52.1, weaker than expectations of 55.8. In addition, U.S. construction spending unexpectedly fell -0.1% m/m in May, weaker than expectations of +0.3% m/m. At the same time, the U.S. June S&P Global manufacturing PMI increased to 51.6, falling slightly short of the 51.7 expected level.
“While manufacturing is contracting, the rest of the economy is in decent shape ... the Fed wants the economy to keep running in low gear near-term. They will see ongoing softness in manufacturing as contributing to their goal of less inflation,” said Bill Adams, chief economist at Comerica Bank.
Meanwhile, Fed Chair Jerome Powell is scheduled to participate in a policy panel discussion with European Central Bank President Christine Lagarde at the ECB’s annual forum in Sintra, Portugal, later today, with investors eagerly awaiting to see if he will offer any new insights on interest rates.
U.S. rate futures have priced in an 8.8% chance of a 25 basis point rate cut at July’s monetary policy meeting and a 59.9% probability of a 25 basis point rate cut at the conclusion of the Fed’s September meeting.
On the economic data front, all eyes are focused on the U.S. JOLTs Job Openings data, set to be released in a couple of hours. Economists, on average, forecast that the May JOLTs Job Openings will come in at 7.960M, compared to the previous figure of 8.059M.

Have a safe day out there. Remember to let the trades come to you. If it's not there (and it may not be this week) don't force it.  Sitting on your hands is a skillset and knowing when not to trade is an important discipline.

Welcome to a new week traders! This is a holiday shortened week with the markets closed Thursday for the 4th of July holiday. Our week ended o.k. on Friday  with scalping really pulling its weight. 

Lets take a look at the markets. Technicals are flashing a slight bearish lean but its not very strong.

Basically, we continue to coil here. Credit to the IWM and DIA though. They are both holding above their respective 50DMA, which has been tough for them.

To get a better "overall" view of the markets bias I like to use the VTI. Our swing trade setups on this have been money this year but we don't currently have a setup to initiate a new trade. It certainly looks like it wants to roll over. We are just waiting on a MACD confirmation to enter a potential short swing trade.

We don't have much in the way of earnings trades this week. We do have a couple of potential news catalysts in the form of FOMC minutes on Weds. and NFP on Friday. With the holiday shortened week, Friday may be our best opportunity for trade setups. 
Let's take a look at the weekly expected moves. They are depressing, to say the least, from a credit traders perspective. This means, most likely that we will be looking at more debit trades this week. Agian, Friday may be our best day with NFP to get some movement.

Looking at the VIX1D (One day ViX) you can see the problem. 

A grind higher will make this low I.V. enviroment even worse. We NEED some downward movment to get I.V. back to where we like it. 
You can see last weeks performance didn't have many standouts. 

The number of stocks below their 50/200 DMA's is also a concern for the bulls 

The Fear/Greed index also shows the complacency. 

The visual of last weeks market doesn't show many sector trends firming up either. 

My lean for today is of so slightly bullish. In spire of the weak results last week and the lack of strength in the tecnicals, I think the futures pointing up this morning gives us a clue that the market wants to, if nothing else, hold here. 

​In Friday’s trading session, Wall Street’s major averages closed lower. Nike (NKE) tumbled about -20% and was the top percentage loser on the S&P 500 and Dow after the world’s largest sportswear company reported weaker-than-expected Q4 revenue and provided FY25 revenue guidance that fell short of analyst estimates. Also, Kura Sushi USA (KRUS) plunged more than -23% after reporting disappointing preliminary Q3 results and cutting its full-year revenue guidance. In addition, Accolade (ACCD) plummeted over -43% after the company issued below-consensus Q2 and FY25 revenue guidance. On the bullish side, Infinera (INFN) climbed more than +15% after Nokia Oyj agreed to acquire the company in a deal valued at about $2.3 billion.
Data from the U.S. Department of Commerce on Friday showed that the U.S. core PCE price index, a key inflation gauge monitored by the Federal Reserve, came in at +0.1% m/m and +2.6% y/y in May, in line with expectations. Also, the U.S. Chicago PMI rose to a 7-month high of 47.4 in June, stronger than expectations of 39.7. In addition, U.S. May personal spending rose +0.2% m/m, weaker than expectations of +0.3% m/m, while U.S. May personal income rose +0.5% m/m, stronger than expectations of +0.4% m/m. Finally, the University of Michigan’s gauge of consumer sentiment was revised upward to 68.2 in June, stronger than expectations of 66.0. 
“From the market’s perspective, [Friday’s] PCE report was near perfect. The Fed’s favorite inflation indicator not only showed inflation was moving towards the Fed’s inflation target but that the economy was resilient. Consumer spending was on the rise and take-home pay was also up after a couple of sluggish months,” said David Donabedian at CIBC Private Wealth U.S. 
Richmond Fed President Thomas Barkin remarked on Friday that the battle against inflation has not yet been won, emphasizing that the U.S. economy is expected to stay resilient as long as unemployment stays low and asset valuations remain high. Also, Barkin noted, “Given the remarkable strength we are seeing in the economy,” he is receptive to the notion that the longer-term equilibrium rate balancing supply and demand “has shifted up somewhat” and that policy may not be as restrictive as perceived.
U.S. rate futures have priced in a 10.9% chance of a 25 basis point rate cut at July’s monetary policy meeting and a 56.3% probability of a 25 basis point rate cut at the conclusion of the Fed’s September meeting.
Meanwhile, the U.S. stock markets will close early at 1 p.m. Eastern Time on Wednesday and remain closed on Thursday for the Independence Day holiday.
The highlight of the holiday-shortened week will be the U.S. Nonfarm Payrolls report for June. Also, investors will be eyeing a spate of other economic data releases, including U.S. JOLTs Job Openings, ADP Nonfarm Employment Change, Initial Jobless Claims, S&P Global Composite PMI, S&P Global Services PMI, Factory Orders, ISM Non-Manufacturing PMI, Crude Oil Inventories, Average Hourly Earnings, and Unemployment Rate.
Market participants will also be focused on remarks from Fed Chair Jerome Powell, who, along with New York Fed President John Williams, is set to participate in the European Central Bank’s annual forum in Sintra, Portugal this week.
In addition, investors will be keeping an eye on the release of the Fed’s minutes from the June meeting on Wednesday, which may provide further insights into the policymakers’ views on inflation, interest rates, and the economy.
Today, all eyes are focused on the U.S. ISM Manufacturing PMI, set to be released in a couple of hours. Economists, on average, forecast that the June ISM manufacturing PMI will come in at 49.2, compared to the previous month’s value of 48.7.
Also, investors will focus on the U.S. S&P Global Manufacturing PMI, which stood at 51.3 in May. Economists foresee the June figure to be 51.7.
U.S. Construction Spending data will be reported today as well. Economists foresee this figure to stand at +0.3% m/m in May, compared to the previous number of -0.1% m/m.

Let's have a great, shortened trading week folks!