Market analysis for Aug. 27th, 2024

Welcome back traders! We had a really nice start to the week. Our net liq on our model portfolio was up over 3K on the day and, most importantly we have hit a new All Time High, YTD result for our 0DTE's. We are very close to $330,000 of documented profits on less than $50,000 of capital deployed each day. This is by and far our best year ever with the 0DTES and I believe it is directly attributable to the fact that we have seven opportunites each day with unique setups that others simply aren't using. We realized the loss on our last NDX debit spread yesterday but that's really just an accounting issue. That trade generated over $47,000 in cash flow for us over the last month. I've always thought trading was the best career in the world. I like the idea that money can make the money, not our physical efforts. I also love the satisfaction, when it goes well, that sure, all you did was push some buttons but you pushed the right ones! Our next goal is to get to $400,000 in profits. These setups are changing lives, if you can learn them and deploy them responsibly. Here's a look at our results from yesterday.

Let's take a look at the markets. The bullish bias hasn't diminished but we see to be getting a little tired here. 
​

The DIA hit a new ATH yesterday with most of the other indices down slightly.

Where do we go from here? Well, it seems everyone is setting up for the most anticipated earnings result of the year. NVDA reports tomorrow, after the close. We'll be trading it, as I assume everyone will. 
For me that means another day of neutral bias for me. We could rise of fall a bit but that big action is priming for after the close on Weds. and Thurs. cash markets. 

​September S&P 500 E-Mini futures (ESU24) are down -0.04%, and September Nasdaq 100 E-Mini futures (NQU24) are up +0.05% this morning as investors awaited a fresh batch of U.S. economic data and braced for Nvidia’s financial report due on Wednesday.
In yesterday’s trading session, Wall Street’s major indexes ended mixed, with the blue-chip Dow posting a new record high and the tech-heavy Nasdaq 100 dropping to a 1-week low. PDD Holdings (PDD) plummeted over -28% and was the top percentage loser on the Nasdaq 100 after the Temu-owner reported weaker-than-expected Q2 revenue. Also, chip stocks slumped, with Arm (ARM) sliding nearly -5% and Marvell Technology (MRVL) dropping more than -4%. In addition, Tesla (TSLA) fell over -3% after Canada announced it would levy a new 100% tariff on Chinese-made electric vehicles, which includes Teslas manufactured in China. On the bullish side, energy stocks gained ground as the price of WTI crude climbed over +3% to a 1-week high, with Marathon Oil (MRO) and ConocoPhillips (COP) rising more than +1%. Also, BJ’s Wholesale (BJ) advanced over +1% after JPMorgan upgraded the stock to Neutral from Underweight.
The U.S. Census Department said on Monday that U.S. durable goods orders surged +9.9% m/m in July, topping the +4.0% m/m consensus and rebounding from a -6.9% m/m slump in June (revised from -6.6% m/m). At the same time, U.S. July core durable goods orders unexpectedly fell -0.2% m/m, weaker than expectations of 0.0% m/m. 
Richmond Fed President Thomas Barkin said on Monday that he still sees upside risks for inflation, though he supports “dialing down” interest rates amid a cooling labor market. Also, San Francisco Fed President Mary Daly stated that she believes it’s appropriate for the Fed to begin reducing interest rates and indicated that a larger rate cut remains on the table if the labor market weakens further. “Hard to imagine anything that could derail the September rate cut,” Daly said.
U.S. rate futures have priced in a 71.5% chance of a 25 basis point rate cut and a 28.5% chance of a 50 basis point rate cut at the next FOMC meeting in September.
Meanwhile, investors are awaiting an earnings report from AI-darling Nvidia (NVDA) on Wednesday. Expectations heading into the chipmaker’s quarterly results are high, with analysts forecasting another strong consensus beat that could lead to an upward revision in the company’s profit guidance. The July reading of the U.S. core personal consumption expenditures price index, the Fed’s first-line inflation gauge, set to be released on Friday, will also be on investors’ radar.
Today, all eyes are focused on the U.S. Conference Board’s Consumer Confidence Index, set to be released in a couple of hours. Economists, on average, forecast that the August CB Consumer Confidence index will stand at 100.9, compared to last month’s figure of 100.3.
Also, investors will focus on the U.S. S&P/CS HPI Composite - 20 n.s.a., which arrived at +6.8% y/y in May. Economists foresee the June figure to be +6.2% y/y.
The U.S. Richmond Manufacturing Index will be reported today as well. Economists estimate this figure to come in at -14 in August, compared to the previous value of -17.
In the bond market, the yield on the benchmark 10-year U.S. Treasury note is at 3.834%, up +0.45%.

Our trade docket for today:
CHWY, /MNQ,QQQ scalps, /NG, /ZC, FSLR, NEM, 0DTE's. I'm holding some cash in prep for NVDA Weds./Thurs. setup.

Let's take a look at the intra-day levels that are important to me today:
/ES; We've been stuck on the PoC (purple line) since the 19th! We push up. We drop down but we seem glued to it. I'm sure NVDA earnings will shake things loose later this week but for today? I'm going to  be throwing a couple butterflies on with our 0DTE's today. Between 5658-5619 is just meaningless chop. Above 5658 we could get bullish. Below 5619 we could get bearish.

/NQ; The Nasdaq, while weaker than the SP500, is doing the same thing as well. Stuck around it's PoC going all the way back to Aug. 15th. There seems to be a tad more weakness in the Nasdaq. Ranges are tight today. Above 19637 could lead to bullish action. Below 19505 and there could be significant downside.

Let's go have another great day! We've got a new NDX debit working now to replace our expired one. It's another juicy one! $5,736 debit could produce $24,264 profit IF it hits. We haven't had much success with our debit setups hitting their profit zones but they sure have paid off on the cash flow side.