What a day yesterday. I'm always surprised more traders don't use technicals more. They never tell us when an event will happen but they sure give us clues as to what the next move may be. We've been talking here for two weeks about Stocastics being overbought. RSI pinned to the upside. Keltner and Bollinger bands being pressed to the upside etc. I saw a lot of chatter yesterday by traders who were just plain surprised that the market took a dump. I on the other hand was surprised it just kept going up. Well, we got what we asked for yesterday. Weds. I complained all day about horrible vol and I.V. That certainly wasn't the case yesterday. It was a perfect day for traders. We had a good day. It could have been much, much better but I try to never complain when we are making money. Here's our results for the day. 

Heading into today's session we are back to a technical neutral rating.

Futures are mostly flat.

​In yesterday’s trading session, Wall Street’s major indexes closed mixed, with the tech-heavy Nasdaq 100 dropping to a 1-week low. Tesla (TSLA) slumped over -8% and was the top percentage loser on the S&P 500 and Nasdaq 100 after Bloomberg News reported that the company was delaying its planned robotaxi event by about two months to October. Also, Delta Air Lines (DAL) slid about -4% after the top U.S. carrier posted downbeat Q2 results and provided below-consensus Q3 adjusted EPS guidance. In addition, chip stocks retreated, with Nvidia (NVDA) falling more than -5% and Intel (INTC) dropping nearly -4% to lead losers in the Dow. On the bullish side, WD-40 (WDFC) gained over +4% after the company reported better-than-expected Q3 results.
The Labor Department’s report on Thursday showed consumer prices edged down -0.1% m/m in June, lower than the predicted figure of +0.1% m/m. On an annual basis, headline inflation eased to +3.0% in June from +3.3% in May, better than expectations of +3.1%. In addition, the core CPI, which excludes volatile food and fuel prices, eased to a 3-year low of +3.3% y/y in June, better than expectations of no change at +3.4% y/y. At the same time, the number of Americans filing for initial jobless claims in the past week fell -17K to a 6-week low of 222K, stronger than expectations of 236K.
Chicago Fed President Austan Goolsbee described the latest inflation data on Thursday as “excellent,” stating that the figures provided the evidence he has been waiting for to be confident that the central bank is on track to achieve its 2% goal. Also, San Francisco Fed President Mary Daly said, “With the information we have received to date, which include data on employment, inflation, GDP growth, and the outlook for the economy, I see it as likely that some policy adjustment will be warranted.” At the same time, St. Louis Fed President Alberto Musalem stated that the June CPI report indicated “encouraging further progress towards lower inflation,” but he would like additional evidence of easing price pressures.
“We’ll see you September! Better-than-expected inflation readings in many key sectors should allow the Fed to start talking about adjusting policy in July - and potentially allow the Fed to act in September,” said George Mateyo at Key Wealth. “That said, we still see the Fed wanting to gain further confidence before cutting aggressively unless stress materializes in the labor market.”
U.S. rate futures have priced in a 6.7% chance of a 25 basis point rate cut at the next FOMC meeting in July and an 86.4% probability of a 25 basis point rate cut at the September FOMC meeting.
Meanwhile, the second-quarter corporate earnings season gets underway, with some of the biggest U.S. banks, including JPMorgan Chase (JPM), Wells Fargo (WFC), and Citigroup (C), slated to release their quarterly results today.
On the economic data front, all eyes are focused on the U.S. Producer Price Index, set to be released in a couple of hours. Economists, on average, forecast that the U.S. June PPI will stand at +0.1% m/m and +2.3% y/y, compared to the previous figures of -0.2% m/m and +2.2% y/y.
The U.S. Core PPI will also be closely watched today. Economists expect June’s figures to be +0.2% m/m and +2.5% y/y, compared to the previous numbers of 0.0% m/m and +2.3% y/y.
The U.S. Michigan Consumer Sentiment preliminary reading will be reported today as well. Economists estimate this figure to arrive at 68.5 in July, compared to 68.2 in June.
In the bond market, the yield on the benchmark 10-year U.S. Treasury note is at 4.222%, up +0.77%.

​Dealer gamma exposure (GEX) skyrocketed 250% this week to $16B, the highest on record. High dealer gamma means dealers are net long options. Large gamma spikes like this typically precede significant upward momentum, which creates the environment necessary for a violent reversal

​Gamma Exposure (GEX) is telling us we're about to enter the final blow off top. In this phase there is almost always increased speculation in micro caps & derivatives as the top performing stocks begin selling off.

​Looks like a rotation out of Tech into REITs & Utilities could be underway after yesterday’s CPI print…

I've also been saying for a month now that the divergence between the SPY and QQQ's continually hitting new ATH's and the IWM and DIA staying weak would resolve. That appears to be happening with strength in the DIA and IWM and the SPY and QQQ's weakening. 

We haven't been able to get one of our VTI swing trades working yet this month but it looks like we may be getting closer to a short setup 

Our trade docket today will be primarily focused on our 0DTE's. No zoom feed today. I'm up at our cabin with the family and the boat that, I'm sure we have some mechanical malfunction (it always does) and the internet is poor. I'll also skip scalping. It certainly saved us yesterday.
​Have a great weekend all! Remember for today...just trade what you see. No bias.

We had a really nice day yesterday...I am frankly amazed. I truely have not see a day like this in the past five years of running this trading room. Low vol. and I.V. just absolutely in the tank! Credit trades have horrible risk/reward ratios right now. Fine. Let's flip to debit trades. That's not much easier. All our indicators are bullish. The market is bullish, but do you really want to go long here at this level? How about bearish? We certainly seem overstretched to the upside but...no real sell or reversal signals yet either. Tough, tough market. We get CPI this morning. Maybe that will juice the premiums a bit. Here's our results from yesterday. 

Federal Reserve Chair Jerome Powell told House lawmakers on Wednesday that he perceives inflation to be diminishing, though he remains uncertain whether price increases are sustainably slowing toward the Fed’s 2% target. Also, Powell stated the Fed doesn’t require inflation to drop below 2% before reducing rates, while noting that officials still have more work to do. In addition, the Fed chief remarked that the labor market has cooled “pretty significantly.”
“Markets remain remarkably calm despite the flood of data this week, including Fed Chair Powell’s testimony, CPI/PPI reports, and the beginning of earnings season,” said Mark Hackett at Nationwide. “This could be challenged by the CPI reading.”
Meanwhile, U.S. rate futures have priced in a 4.7% chance of a 25 basis point rate cut at the July FOMC meeting and a 68.1% probability of a 25 basis point rate cut at the September meeting.
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. June CPI will arrive at +0.1% m/m and +3.1% y/y, compared to the previous numbers of 0.0% m/m and +3.3% y/y.
The U.S. Core CPI data will also be closely watched today. Economists anticipate the Core CPI to be +0.2% m/m and +3.4% y/y in June, compared to the previous figures of +0.2% m/m and +3.4% y/y.
According to a survey by 22V Research, 55% of investors anticipate a “risk-on” market reaction to the CPI report, while 16% foresee a “risk-off” response, and 29% expect a “mixed/negligible” response.
U.S. Initial Jobless Claims data will be reported today as well. Economists estimate this figure to be 236K, compared to last week’s number of 238K.
In addition, market participants will be anticipating a speech from Atlanta Fed President Raphael Bostic.
On the earnings front, PepsiCo (PEP) and Delta Air Lines (DAL) are slated to report their Q2 earnings results today.
In the bond market, the yield on the benchmark 10-year U.S. Treasury note is at 4.277%, down -0.02%.

Pre-CPI release the technicals are all still bullish. 

All the major indicies look very bullish here. 

However, RSI is above 80 and we are pushing on the upper Bollinger band. We look overstreched. 

It's also interesting the most fund managers are pretty much "all in" at this point. That's bearish. 

It's also worth noting, the Hindenburg Omen triggered yesterday. Not aware of it? Google it!

I'm not looking at intra-day levels today as CPI should serve as the catalyst for the day.

Our trade docket for today is simply to book profits where we can. Free up some cash and focus on 0DTE's. This market simply isn't rewarding us for taking other risks. 

Welcome to midweek!. We had a decent day yesterday. It would be nice if I could catch a trend runner in my scalping efforts but today is another day. We have a small long call position on the QQQ's that we carried over from yesterday which looks good pre-market. 

We got a jump on our ETH and BTC crypto 0DTE's last night with some pretty nice setups that look to cash flow for us today. Speaking of crypto, something to keep an eye on is the rainbow chart analysis. Here's an overview for you; 
There has been no small amount of uncertainty surrounding Bitcoin (BTC) for approximately a month. After a significant climb in the initial months of 2024 and a new all-time high (ATH) just above $73,000 in March, the world’s premier cryptocurrency found itself in a strong downtrend in June and early July.
While the decline is widely considered to be at least partially driven by a convergence of events – including the German government’s plans to offload seized BTC and the long-awaited repayments by the collapsed crypto exchange Mt. Gox – the fact that Bitcoin has crashed through multiple support zones has left many investors wary.
Though BTC remains 32.44% in the green in the year-to-date (YTD) chart, it has fallen nearly 20% in the last 30 days of trading and is 23.09% below its yearly – and all-time – highs. 

By July 8, the cryptocurrency appears to have settled in the range between just below $54,500 and just above $56,000 – levels not seen since February – with little certainty about whether the next move will take it higher or lower. Bitcoin price today, at press time, stands at $56,147.

BTC YTD price chart. Source: FInboldIn this climate of fear and uncertainty, the Bitcoin Rainbow Chart – a tool that utilizes a logarithmic growth curve and describes investor sentiment at various price levels – can offer valuable insights into what the coin’s next move in the crypto market may be.
The 2024 Bitcoin Rainbow chartThe Bitcoin Rainbow Chart is divided into nine color-coded zones, each representing a certain price range and the associated market sentiment. These range from ‘Bitcoin is dead’ – lows that indicate that severe bearish sentiment prevails – to ‘Maximum Bubble Territory’ – highs that are so high that the cryptocurrency’s price is likely to plummet.
According to the chart, the recent downtrend brought Bitcoin to the border between ‘Accumulate’ – levels that indicate it is a good time to purchase more of the coin – and ‘Still cheap’ – another zone predicted to be well below BTC’s forthcoming highs.

Bitcoin Rainbow chart predicts Bitcoin ranges for end of 2024In addition to presenting Bitcoin’s historical performance and placing it in a market sentiment context, the Rainbow Chart also offers some insights into the likely future prices of the world’s premier cryptocurrency.
According to the tool, should BTC find itself below $37,417.75 in late December, it would mean that the current bull cycle is likely at an end and that the winds of the crypto winter are again blowing strong. 
On the other hand, trading above $186,667.72 would hint that Bitcoin has become a bubble, while sustained closes above $244,473.74 would all but guarantee it, meaning that a major correction is almost certainly imminent.

Bitcoin Rainbow chart zones for late 2024. Source: BlockhainCenterEslewhere, the Rainbow chart indicates that BTC would be the most stable at the end of 2024 if it remains between $85,730.33 and $112,983.27 – the ‘HODL’ range – and relatively stable, though investors would do well to keep a lookout for the range between $112,983.27 and $144,774.1 – the ‘Is this a bubble?’ range.
Finally, the tool strongly suggests that an investor would be right to buy Bitcoin near the end of 2024 if it trades in the zone between $50,768.84 and $65,962.8 as it marks the area as ‘Accumulate’ though prices up to $85,730.33 would still be considered relatively cheap.
​In prepared remarks for a Senate hearing Tuesday, Fed Chair Jerome Powell said that “more good data” would bolster confidence that inflation is moving down toward the Fed’s 2% target, noting that recent readings indicate “modest further progress” on prices. Also, Powell remarked that lowering rates too soon or too much could harm inflation progress. In addition, the Fed chief described the labor market as “strong, but not overheated” and noted that the central bank’s restrictive stance is effectively balancing supply and demand.
“Powell keeps the ship steady. Chair Powell’s prepared testimony struck a balanced tone,” said Peter Williams at 22V Research. “September remains modal, if notably more tentative than priced currently. But with the Fed balancing risks, upside surprises to labor market or inflation data could delay the first cut.”
U.S. rate futures have priced in a 4.7% chance of a 25 basis point rate cut at the next central bank meeting in July and a 70.0% chance of a 25 basis point rate cut at September’s policy meeting.
Today, investors will closely monitor Federal Reserve Chair Jerome Powell’s semi-annual monetary policy testimony before the House Financial Services Committee.
Also, market participants will be looking toward speeches from Chicago Fed President Austan Goolsbee, Fed Governor Michelle Bowman, and Fed Governor Lisa Cook.
On the economic data front, investors will likely focus on U.S. Crude Oil Inventories data, set to be released in a couple of hours. Economists estimate this figure to be 0.700M, compared to last week’s value of -12.157M.
U.S. Wholesale Inventories data will be reported today as well. Economists expect May’s figure to be +0.6% m/m, compared to +0.1% m/m in April.
Meanwhile, the focus remains on the June reading of the U.S. Consumer Price Index, scheduled for release on Thursday, which is expected to show a decline in inflation to +3.1% y/y from +3.3% y/y in May.
Second-quarter corporate earnings season begins in earnest on Friday, with major banks such as JPMorgan Chase (JPM), Wells Fargo (WFC), and Citigroup (C) set to report their quarterly results.
In the bond market, the yield on the benchmark 10-year U.S. Treasury note is at 4.286%, down -0.28%.

Markets remain bullish. 

I know I seem like a broken record, repeating myself daily but...this divergence in the market is not a bullish indicator of things to come. 

Add to the the fact that $SPY Today was the lowest volume day since Dec. 24th 2019 (half day before Christmas). $SPY Today was the lowest volume day for a full day ever? Crazy. 
SPX 30 day realized volatility making new 4-year low of 5.7%. So the VRP, the implied realized volatility spread, is 4.5% (96th percentile).

​The VIX1D is in the tank! This is not a favorable enviroment for option sellers. We are 50% off where I.V. should be for optimal selling setups! 50%!!!!! I honestly can't remember the last time I've seen this.

For us, as option sellers it simply means we trade smaller and get more selective in the trades we do take.

Trade docket for today; FSLR, LEVI, NVDA, ORCL, TSLA, 0DTE's 

Let's have a great day folks. If you're an option seller be cautious. I'm looking to more asymmetric setups. Chicken Iron condors, Broken wing butterflies, Iron butterflies etc.

Welcome back traders! We had a solid day yesterday. Premiums are still in the basement and our debit set ups look less appealing with our 0DTE's but we still managed to get a nicely profitable day. 

Yesterday was more of the same. Strength in the SPX and NDX (hitting new ATH's) and weakness in IWM and DIA.

The total market index EFT, VTI seems overstretched and stalling. 

More interesting to me continues to be the divergence between the SPY and RSP. This wide of a divergence can't last forever. They will eventually converge. Whether that means SPY pulling RSP up or RSP pulling SPY down. It's usually the later.

​In yesterday’s trading session, Wall Street’s major indexes ended mixed, with the benchmark S&P 500 and tech-heavy Nasdaq 100 posting new record highs. Corning (GLW) surged about +12% and was the top percentage gainer on the S&P 500 after the glass and advanced optics maker raised its Q2 core sales guidance. Also, chip stocks gained ground, with Intel (INTC) climbing over +6% to lead gainers in the Dow and Nasdaq 100 and Advanced Micro Devices (AMD) rising nearly +4%. In addition, Morphic Holding (MORF) soared more than +75% after Eli Lilly agreed to buy the U.S. gut drug maker in a deal valued at $3.2 billion. On the bearish side, Nike (NKE) fell over -3% and was the top percentage loser on the Dow following Jim Cramer’s remarks that the company’s latest conference call was a “call of despair” and that he “can’t find anything going right for the company.”
Economic data on Monday showed that U.S. consumer credit increased by +$11.35B in May, stronger than expectations of +$10.70B and the largest increase in 4 months.
Meanwhile, Oppenheimer’s John Stoltzfus, chief investment strategist in the firm’s asset-management business, increased his year-end target for the S&P 500 to 5,900 from 5,500 on Monday, citing a strong earnings outlook and a resilient economy that could support even higher valuations. “S&P 500 earnings results over the most recent reporting seasons and economic data that has provided evidence of resilience remain at the core of our bullish outlook for stocks,” Stoltzfus noted.
Today, market participants will closely monitor Fed Chair Jerome Powell’s semi-annual monetary policy testimony before the Senate Banking Committee. Powell faces pressure from lawmakers increasingly eager for interest rate cuts and others dissatisfied with the central bank’s recent plan to raise capital requirements for Wall Street lenders.
Also, investors will likely focus on speeches from Fed Vice Chair for Supervision Michael Barr and Fed Governor Michelle Bowman, due later in the day.
Aside from Powell’s testimony, the U.S. consumer inflation report for June, scheduled for release on Thursday, will be a highlight. Market participants anticipate the latest report to show annual headline inflation easing to 3.1% in June from 3.3% in May.
“While the CPI release will be key, we will be looking for signs from Powell that the Fed is edging closer to a decision to cash in its chips and move in September provided ongoing inflation news broadly confirms that the run-rate has stepped back down,” said Krishna Guha at Evercore.
U.S. rate futures have priced in a 4.7% chance of a 25 basis point rate cut at July’s monetary policy meeting and a 73.6% chance of a 25 basis point rate cut at the conclusion of the Fed’s September meeting.
Second-quarter corporate earnings season begins in earnest on Friday, with major banks such as JPMorgan Chase (JPM), Wells Fargo (WFC), and Citigroup (C) set to report their quarterly figures. According to data compiled by Bloomberg, expectations for 12-month forward earnings are at an all-time high.
The U.S. economic data slate is largely empty on Tuesday.

Let's have another good day out there folks. Remember, you don't need to swing for the fences or hit home runs. If we can make $1,000 dollars today that's a tremendous victory.

Good morning traders! Welcome back to a full week of trading action. I hope everyone had a nice 4th and a great weekend. It's time to get back to the action. 
Markets are still flashing buy. I took a bearish stance on both Weds. and Fri. and I was wrong! 

Technicals continue to point up.

We cleared some pretty important resistance zones on the SPY and QQQ Friday. The IWM and DIA continue to languish. 
The U.S. Labor Department’s report on Friday showed that nonfarm payrolls rose by 206K jobs last month, surpassing the 191K consensus but at a slower pace than the 218K recorded in May, which was revised down from 272K. Also, the U.S. June unemployment rate unexpectedly rose to a 2-1/2 year high of 4.1%, weaker than expectations of no change at 4.0%. In addition, U.S. average hourly earnings came in at +0.3% m/m and +3.9% y/y in June, in line with expectations.
“Get on with it. [Friday’s] employment report ought to firm up expectations of a September rate cut. Economic conditions are cooling and that makes the trade-offs different for the Fed,” said Neil Dutta at Renaissance Macro Research. 
Meanwhile, New York Fed President John Williams said Friday that although inflation has recently moderated toward the central bank’s 2% target, policymakers are still some way off from reaching their goal. “Inflation is now around 2-1/2%, so we have seen significant progress in bringing it down. But we still have a way to go to reach our 2% target on a sustained basis,” Williams said. “We are committed to getting the job done.”
U.S. rate futures have priced in a 6.7% chance of a 25 basis point rate cut at the Fed’s monetary policy committee meeting later this month and a 69.0% probability of a 25 basis point rate cut at the September FOMC meeting.
Second-quarter earnings season kicks off this week, with big banks such as JPMorgan Chase (JPM), Wells Fargo (WFC), and Citigroup (C) set to release their earnings reports on Friday. PepsiCo (PEP) and Delta Air Lines (DAL) are among other major names scheduled to deliver quarterly updates during the week.
On the economic data front, the U.S. consumer inflation report for June will be the main highlight. Also, market participants will be monitoring other economic data releases this week, including the U.S. Core CPI, PPI, Core PPI, Crude Oil Inventories, Wholesale Inventories, Initial Jobless Claims, and Michigan Consumer Sentiment Index (preliminary).
In addition, investors will focus on Fed Chair Jerome Powell’s semi-annual monetary policy testimony on Capitol Hill. Mr. Powell will testify before the Senate Banking Committee on Tuesday and the House Financial Services Committee on Wednesday. Powell is expected to tell lawmakers that Fed officials need more evidence of slowing inflation before considering interest rate cuts, despite mounting evidence of softer growth and employment. Fed Vice Chair for Supervision Michael S. Barr, Fed Governor Michelle Bowman, Chicago Fed President Austan Goolsbee, Fed Governor Lisa Cook, and Atlanta Fed President Raphael Bostic are also scheduled to speak this week.
Today, investors will likely focus on U.S. Consumer Credit data. Economists, on average, forecast that May Consumer Credit will stand at $10.70B, compared to the previous value of $6.40B.
In the bond market, the yield on the benchmark 10-year U.S. Treasury note is at 4.310%, up +0.86%.
Let's take a look at the expected moves for this week in the SPY/QQQ.

Not much difference than last week. We continue to be about 20%-30% lower on I.V. than we would like.

The 1 day VIX reading continues to sit in the basement. This likely means more debit trades for us this week.

My lean is bullish today. Its hard to be anything but with the substantive resistance levels that were broken on Friday. 

The fear and greed index is also close to neutral. No clear reading here. 

One quick note for the upcoming trading sessions. This Thursday, after the close we're headed up to our cabin at East Canyon until Monday evening. I'll be trading with you in the live trading room on Friday and Monday but no zooms as the connection is weak there. Also no scalping for me on those two days. 

Bitcoin; Mt. Gox payments are set to start getting disbursed. This means a lot of potential liquidation is coming. I do think after this we start to see a bottom. Heavens knows BTC has been beat up a lot lately. 

One last push on my bearish concerns. 

• The cost of an Independence Day cookout hit a record high of $71.22 for 10 guests.
• The June US jobs report shows a nonfarm payroll growth slowing to 1.4% annualized and unemployment rising to 4.1%.
• Brazil's real performed the worst among EM currencies, down 7% last month.
• US manufacturing contracted for a third straight month in June as demand remained subdued.
• US interest costs on the national debt will soon reach an all-time high, projected to total $12.9 trillion over the next decade.
• California's gas tax increased to 60 cents per gallon on July 1, 2024, making it the highest in the nation.
• Deepfakes will soon be undetectable to the average person, leaving them more susceptible to deepfake scams.
• Inflation in Russia has gone far above the 4% target rate, despite rapid GDP growth and low unemployment.

Market internals continue to break down while the index itself continues to charge higher. This never lasts. At some point the overall internals will rise which could trigger a massive upside or, the techs that are driving the index higher reverse and fall in line with the overall market, in which case we could get a decent sized pullback.

Be picky this week with your credit trades folks You're not getting paid very well for them.

Good morning traders! Welcome back after the holiday. I hope everyone had a nice break from the action and are refreshed! We didn't make many trades and no 0DTE's on Weds. shortened session.

​Let's get into it and take a look at the markets.

Technicals are still holding on the buy signal. 

We've got the SPY and QQQ back to new ATH's. Is this the start of a new bull leg? Meanwhile the IWM and DIA continue to not participate. The IWM just can't seem to break above the 50DMA and the DIA is treading water.

Let's take a look at the news for today:
​September S&P 500 E-Mini futures (ESU24) are up +0.04%, and September Nasdaq 100 E-Mini futures (NQU24) are up +0.11% this morning as trading resumed after the Independence Day holiday, with market participants bracing for the all-important U.S. payrolls reading due later in the day.
The minutes of the Federal Open Market Committee’s June 11-12 meeting, released Wednesday, showed that officials didn’t deem it appropriate to lower borrowing costs “until additional information had emerged to give them greater confidence that inflation” is on track to their 2% goal. Officials pointed to inflation progress evidenced by smaller monthly gains in the core personal consumption expenditures price index and May consumer price data released hours before the rate decision. While “some” participants emphasized the need for patience, “several” officials highlighted that further weakening in demand could lead to a larger increase in unemployment. At the same time, the minutes showed that several policymakers remained ready to raise interest rates if inflation remained elevated. “Participants noted the uncertainty associated with the economic outlook and with how long it would be appropriate to maintain a restrictive policy stance,” according to the FOMC minutes.
In Wednesday’s holiday-shortened trading session, Wall Street’s main stock indexes ended mixed, with the benchmark S&P 500 and tech-heavy Nasdaq 100 notching new record highs. Paramount Global (PARA) surged nearly +7% and was the top percentage gainer on the S&P 500 after the Wall Street Journal reported that Skydance Media had reached a preliminary agreement to buy National Amusements and merge with Paramount. Also, Tesla (TSLA) climbed more than +6% and was the top percentage gainer on the Nasdaq 100 after Bank of America Global Research raised its price target on the stock to $260 from $220. In addition, chip stocks advanced following a sharp decline in bond yields, with Nvidia (NVDA) and Broadcom (AVGO) rising over +4%. On the bearish side, Simulations Plus (SLP) tumbled more than -14% after the company suspended its quarterly cash dividend and cut its full-year EPS guidance.
The ADP National Employment report on Wednesday showed private payrolls rose by 150K jobs in June, weaker than expectations of 163K. Also, the U.S. June ISM services index fell to 48.8, weaker than expectations of 52.6 and the steepest pace of contraction in 4 years. In addition, U.S. factory orders unexpectedly fell -0.5% m/m in May, weaker than expectations of +0.2% m/m. Finally, the number of Americans filing for initial jobless claims in the past week rose +4K to 238K, compared with 234K expected.
“With the ISM services falling to 48.8, the weakest since the pandemic and job claims deteriorating, ultimately the negative data is being seen as positive for markets,” said Justin Onuekwusi, chief investment officer at St James Place. “It feels like September is the date everyone is now looking at.”
Meanwhile, U.S. rate futures have priced in an 8.8% chance of a 25 basis point rate cut at the next FOMC meeting in July and a 68.1% chance of a 25 basis point rate cut at September’s policy meeting.
Today, all eyes are focused on U.S. Nonfarm Payrolls data, set to be released in a couple of hours. Economists, on average, forecast that June Nonfarm Payrolls will come in at 191K, compared to the previous value of 272K.
A survey conducted by 22V Research revealed varied expectations among investors regarding the market reaction to the jobs report, with 40% predicting a “negligible/mixed” response, 34% expecting “risk-on,” and 26% anticipating “risk-off.”
U.S. Average Hourly Earnings data will also be closely watched today. Economists expect June’s figures to be +0.3% m/m and +3.9% y/y, compared to the previous numbers of +0.4% m/m and +4.1% y/y.
The U.S. Unemployment Rate will be reported today as well. Economists foresee this figure to remain steady at 4.0% in June.
In addition, market participants will be looking toward a speech from New York Fed President John Williams.
In the bond market, the yield on the benchmark 10-year U.S. Treasury note is at 4.342%, down -0.05%.

I have to say, I'm surprised the markets are as strong as they are with FED members now starting to talk about the potential need for a rate HIKE!

My bias for today is bearish. My bias for Wed's shortened session was bearish as well. Guess what? I was wrong! NFP today will be what starts our trade flow off so really it could bullish or bearish today depending on what it looks like but I continue to believe that traders don't want to hold a lot of positions over the weekend. Next week, hopefully, we can get back to some normal volume.

A look at the VTI tells the tale of the market. Sitting at ATH's but no real trigger signal. Its very hard for me to go bullish or bearish here as we just don't have the signals...yet. One thing we know for sure, consolidation always leads to expansion. We will get directional movement. We just don't know when or in what direction. 

Have a great day folks and a nice, safe weekend coming up!

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!

We had another really solid day yesterday. Our re-set NVDA trade has a goal of producing $3,500 a week in income for us. After blowing that number away last week, it looked like this week would be below our goal but yesterdays adjustments brought us to close to $4,000 of potential income for the week. Yesterday was all about asymmetric trade setups. We put a lot of small, low probability but high profit potential trades on. Only one of them hit (SPX chicken Iron condor) but the risk was so small that it ended up being a great success. 

We had MU report after the close with dissapointing results. This knocked the futures down but we are still holding to a slight bullish bias technically.

Once again, yesterdays price action refused to give us any clarity or directional bias. The markets continue to coil here, building kinetic energy and preparing for their next move. It's still unclear when and what direction that will take. 

If you follow our trades you'll know that one of our all time favorite trades is the Theta fairy. Unfortunately we rarely get enough I.V. to get one on. A quick rule of thumb is we want $7.00+ of credit showing on a one standard deviation stike. As you can see, if are far from that. 

That, of course, is due to the low market I.V. as measured via the VIX1D.

We may have found a work around by replacing the /ES for the /MNQ. It's scalable, unlike the /ES and it has much better I.V.. Look for more Theta fairys in the near future as we switch our efforts to this new underlying.

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We've got some market catalysts incoming this morning. 
​Micron Technology (MU) slumped over -6% in pre-market trading after the memory chipmaker provided Q4 sales guidance that trailed the estimates of some investors, overshadowing its stronger-than-expected Q3 results.
In yesterday’s trading session, Wall Street’s main stock indexes closed in the green. FedEx (FDX) surged over +15% and was the top percentage gainer on the S&P 500 after the shipping giant posted upbeat Q4 results, provided a strong 2025 adjusted EPS forecast, and said it would buy back $2.5 billion of its stock over the next year. Also, Apple (AAPL) gained +2% after Rosenblatt Securities upgraded the stock to Buy from Neutral with a price target of $260. In addition, Whirlpool (WHR) climbed over +17% following a report from Reuters that Robert Bosch GmbH is contemplating an offer for the appliance maker. On the bearish side, Moderna (MRNA) plunged about -11% and was the top percentage loser on the S&P 500 and Nasdaq 100 following new data indicating that the efficacy of its RSV vaccine declined significantly in the second year and was inferior to that of rival vaccines.
Economic data on Wednesday showed that U.S. new home sales fell -11.3% m/m to a 6-month low of 619K in May, weaker than expectations of 636K. Also, U.S. May Building Permits were revised higher to 1.399M from a preliminary estimate of 1.386M, yet still marked the lowest level since June 2020.
The Federal Reserve said on Wednesday that the largest U.S. banks passed the annual stress test, clearing the path for higher shareholder payouts. The results indicated that while large banks would face greater losses compared to the 2023 test, they remain well-positioned to weather a severe recession, according to the central bank. “While the severity of this year’s stress test is similar to last year’s, the test resulted in higher losses because bank balance sheets are somewhat riskier and expenses are higher,” said Fed Vice Chair of Supervision Michael S. Barr.
Fed Governor Michelle Bowman on Wednesday reiterated her baseline view that “inflation will decline further with the policy rate held steady,” and she also stated that rate cuts would be “eventually” appropriate if inflation moves sustainably toward 2%.
U.S. rate futures have priced in a 10.3% chance of a 25 basis point rate cut at the July FOMC meeting and a 56.3% probability of a 25 basis point rate cut at September’s policy meeting.
Meanwhile, market participants will be keeping an eye on the first U.S. presidential debate of the 2024 election later today, featuring Democratic President Joe Biden and his Republican challenger Donald Trump.
On the earnings front, notable companies like Nike (NKE), McCormick (MKC), Walgreens Boots Alliance (WBA), and Acuity Brands (AYI) are slated to release their quarterly results today.
On the economic data front, all eyes are on the Commerce Department’s final estimate of gross domestic product, set to be released in a couple of hours. Economists, on average, forecast that U.S. GDP will stand at +1.3% q/q in the first quarter, compared to +3.4% q/q in the fourth quarter.
Also, investors will focus on U.S. Durable Goods Orders data, which came in at +0.7% m/m in April. Economists foresee the May figure to be -0.5% m/m.
U.S. Core Durable Goods Orders data will be reported today. Economists estimate this figure to come in at +0.2% m/m in May, compared to the previous number of +0.4% m/m.
U.S. Pending Home Sales data will come in today. Economists expect May’s figure to be +0.6% m/m, compared to the previous figure of -7.7% m/m.
U.S. Initial Jobless Claims data will be reported today as well. Economists estimate this figure to be 236K, compared to last week’s number of 238K.

No initial intra-day levels for me yet as we have lots of news catalysts incoming shortly.

We'll talk about levels in our live chat room later in the day once we get some price action. Have a great day everyone! Let's see if we can get a repeat of yesterday.