Market analysis for Sep 11th, 2024

We had a rock solid day yesterday. We had to chase it a bit but it ended up great. Check out our results below:
We added in our earnings plays since we do about 20 a month and most end up being day trades. We should be booking profits on PLAY, GME and WOOF this morning. We also got a Theta fairy take profit this morning! Thanks #CPI day! Always nice to start the day off with a crisp $100 dollars in your pocket before the market even opens.

Trade docket today will be slightly altered as today is a travel day for me. No zoom feeds until next Monday. We'll be trading in the trading rooms. Scalping will focus soley on the /MNQ part. We'll start today by booking profits on our earnings setups of GME, PLAY, WOOF and then add to our SPY. Setup a new QQQ. Later in the day we'll look at /MCL and the 0DTE's with KR and SIG as possible new earnings plays.

​September S&P 500 E-Mini futures (ESU24) are trending down -0.31% this morning as market participants refrained from making any big bets ahead of a key U.S. inflation report.
In yesterday’s trading session, Wall Street’s main stock indexes ended mixed. Oracle (ORCL) surged over +11% and was the top percentage gainer on the S&P 500 after the IT giant reported stronger-than-expected Q1 results. Also, Broadcom (AVGO) climbed more than +5% and was the top percentage gainer on the Nasdaq 100 after KeyBanc Capital Markets stated that Apple’s iPhone 16 launch is favorable for the semiconductor and software giant due to all models being upgraded to Wi-Fi 7. In addition, Tesla (TSLA) gained over +4% after Deutsche Bank named the stock a “Top Pick” with a Buy rating and a price target of $295. On the bearish side, Hewlett Packard Enterprise (HPE) plunged more than -8% and was the top percentage loser on the S&P 500 after announcing a $1.35 billion offering of Series C mandatory convertible preferred stock in an underwritten registered public offering. Also, JPMorgan Chase (JPM) slid over -5% and was the top percentage loser on the Dow after the bank’s president indicated that analysts’ projections for next year’s expenses and net interest income might be overly optimistic.
The debate between Vice President Kamala Harris and former President Donald Trump was also in the spotlight, covering topics such as their economic plans, U.S.-China relations, and immigration, though market responses were limited. As the debate concluded, Harris’ chances of winning the election rose to 56% on the betting site PredictIt, up from 53% before the debate.
Today, all eyes are focused on the U.S. consumer inflation report, set to be released in a couple of hours. Economists, on average, forecast that the U.S. August CPI will come in at +0.2% m/m and +2.5% y/y, compared to the previous numbers of +0.2% m/m and +2.9% y/y.
The U.S. Core CPI will also be closely watched today. Economists anticipate the August core CPI to remain unchanged from July at +0.2% m/m and +3.2% y/y.
A survey conducted by 22V Research showed that 48% of investors expect a “mixed/negligible” market reaction to the consumer inflation report, 32% predict “risk-on,” and only 20% foresee “risk-off.”
U.S. Crude Oil Inventories data will be reported today as well. Economists estimate this figure to be 0.900M, compared to last week’s value of -6.873M.
“A 25-basis point interest rate cut seems perfectly reasonable ... there might be a little bit of a risk of overreaction if the Fed were to go 50 bps,” said Lara Castleton, U.S. head of portfolio construction and strategy at Janus Henderson Investors.
U.S. rate futures have priced in a 67.0% chance of a 25 basis point rate cut and a 33.0% probability of a 50 basis point rate cut at the September FOMC meeting.
In the bond market, the yield on the benchmark 10-year U.S. Treasury note is at 3.610%, down -0.95%.

CPI and oil inventory numbers will be the two big drivers for our trading today.
No lean or bias on CPI days. The algos will do what they will do.
​We are back to a neutral rating to start the day, which seems spot on for a CPI catalyst day.

While the last few days have been bullish, most of the indices we trade are still trying to recover their 50DMA. The DIA being the one exception.

Again, no intra-day levels for me on CPI days but it's clear looking at the /ES daily chart that we have been pinching and squeezing for a while now and a big move could be incoming very soon. 

Day's like today (travel days) tend to be pretty good for us. Being forced to wait until later in the day to start our 0DTE's is not always a bad thing. I'll see you all in the trading room shortly!
​Almost a 1% expected move in the SPY today. That should provide us plenty of premium to work with even later in the day.