11/30/2022 Synopsis
Fed Chair Powell provided the catalyst for equities to finish November off strong. The S&P closed above its 200-day MA. The Dow is only 6% away from all-time highs.
Market Overview
Every index popped more than 2% after Federal Reserve Chairman Jerome Powell’s comments at the Brookings Institution, in which he hinted at smaller rate hikes in the near future. It was the S&P’s best day in nearly two weeks. However, the tech-heavy Nasdaq led the way after it gained 4.41%. The S&P 500 closed above its 200-day MA for the first time since April. It’s also the first time its having consecutive monthly gains since the summer of 2021. Every S&P sector was up today led by technology. Energy performed the worst, gaining only +0.50%.
US Treasury rates slid down. The 3-month bill’s yield fell 2 bps to 4.25%. The yield on the 2-year note sank 16.5 bps to 4.31%. The rate on the 10-year note lost 13.7 bps to 3.61%.
The US Dollar index $DXY was down -0.9% to 105.87.
Crude oil gained +2.93% to close back up over 80 (80.49).
Here are some of today’s closing prices.
E-mini S&P 500 Top-Down Analysis
📈 Below are the monthly (5-years), weekly (2-years) and daily (6-months) charts for ES.
M/M: ES is OTFU from October to November. It will have two consecutive green months for the first time since summer 2021. ES also closed November above its 10-month MA for the first time since March.
W/W: ES had an inside week as all the trading on the short Thanksgiving week was contained inside the prior week’s range. ES is also still OTFU.
D/D: It started off setting up to be an inside day with ES failing to take out the previous day’s low by several ticks. Then came Fed Chair Powell’s interview at the Brookings Institution and things changed immediately. ES finally traded above the recent balance area of 3912.50 and 4050.75.
E-mini S&P 500 Metrics
Recent Performance & Technicals
E-mini S&P 500 Volume/Market Profile
ES Composite Volume Profile (5 days)
📈 Here is a chart of the past five sessions with a composite ETH Volume Profile:
ES ETH/RTH Split Volume Profile (5 days)
📈 Here is a chart of the past five sessions with a daily ETH/RTH split Volume Profile:
ES ETH/RTH Split Market/Volume Profile (today)
📈 Here’s a TPO chart of today’s session with ETH/RTH split Market/Volume Profile:
ES Market/Volume Profile Levels
RTH Weak High/Low: 3942.75 (low)
RTH Single Prints: 3970.50 to 4005; 4008.5 to 4028.25; 4044 to 4062; 4063.25 to 4076; 4083.5 to 4087.75
RTH Excess: 4088 to 4093.50
RTH Gap: n/a
Session Recap
Electronic Trading Hours (ETH)
Globex Session:
Wholesale was short at the prior day’s close. The overnight open was inside of the previous day’s value area. Inventory during the overnight session was mostly long, about 88% of the time. There was little supply overnight as ES hit 3956.50 early in the Japan open and the bid couldn’t get lower. Buyers were able to lift the offer for several hours. Going into London’s open, ES was making new overnight highs. At 3977.75, there was some supply and the auction corrected down to VWAP. It traded sideways for the next few TPO periods. Heading into the 8:30am ADP hiring figure release, there was some volatility as ES ripped to the upside (3980) before correcting down, dropping 20 to 25-handles. It failed taking out the overnight low by a few points, hitting 3958 before supply shut off and ES approached VWAP again. VPOC in Globex was 3965.
Range: 23.50
Regular Trading Hours (RTH)
US Session:
The RTH open was inside of the previous day’s value area and several points inside the T+2 low. There was supply in A-period as long traders tried to lift the market but couldn’t accept above VWAP. After failing to lift the offer over 3970.50, the auction rotated down with sellers aggressively taking the bid. ES slid more than 20-handles and dipped underneath the overnight and T+2 low. Price action ricocheted back and forth inside a 20-point range from B to H-period. A double bottom / weak low was put in at 3942.75, a couple of ticks short the prior day’s low. There was strong short covering which put a floor on the day’s session. Once Fed Chair Jerome Powell gave began his commentary at 1:30pm, ES rallied 95-handles over the next hour. Once his appearance ended, ES continued to ascend another 50-points during the remainder of RTH. There were five sets of single prints created on the move up, trapping short traders. RTH ended at 4093.
Range: 150.75