ES Selloff Racks Up Highest Volume in a Month

Everything is moving in the wrong direction.

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Our View

Jeez, this is some rough stuff. 

The ES was already weak when the bond action came out with a D rating and they fell 2.5 points and closed at 115.25, down 2.06 points or 1.85%. The 10 year note (ZNM24)  fell 1.115 points or -1.24%. 

So what does this mean? 

The benchmark Treasury yields jumped, with the 10-year yield settling at 4.559% — its highest level since November — after its biggest one-day gain since September 2022. The 2-, 10- and 30-year yields all finished at their highest levels of the year. The US dollar index is at a six-month high, too. 

US crude settled above $86 a barrel, its fourth-highest finish of 2024, Gold slipped 0.6% to ~$2,329 a troy ounce and Bitcoin rallied, settling above $70,000. Last but not least, the VIX rallied up 16.62 and settled at 15.81, up 0.84 or +5.6% on the day. 

In the end, “everything is moving” — just not in the right direction.

Our Lean — Danny’s Trade

This is Danny Riley’s personal trading plan for the day.

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MiM and Daily Recap

ES Recap

Part 1 Of the 3 Parts Of the Trading Day

The ES traded in a narrow range and rallied up to 5285 8:29:47 as the March (CPI) consumer prices rose 3.5% from a year ago in March — more than expected — and then sold off down to 5202.50 at 8:32:45, rallied up to 5215.50 and then dropped down to 5286.25, bumped up to 5194.50 and then slid down to 5176.50 at 8:42, rallied up to 5200.50 at 8:54. After the push up, the ES sold off down to a higher low at 5279.75 at 9:14 and then rallied up to 5202.00 at 9:29 on total Globex volume of 482k contracts traded and opened Wednesday's regular session at 5199.75.   

Part 2 Of The 3 Parts Of the Trading Day 

After the open, the ES traded 5201.00 and then sold off down to 5192.00 at 9:32, then made a series of higher lows at 5202, 5206.75 at 9:45, 5209.50 at 10:00, 5212.00 at 10:15, 5211.75 at 10:30 and then up to 5226.50 at 10:45. From there, the ES traded back down to 5204.00 at 11:00. It's going to be hard to do any play by play as there was a very high level of chop. I had to move the chart to a 15 minute view. After the 5204 print, the ES rallied back up to the 5210.00 level, and sold off down to 5194,  rallied up to 5202.25, pulled back to 5193.75 at 12:15, rallied up to 5209.00 at 1:15, rallied up to 5216.00 at 1:30, sold off down to a higher low at 5186.50 at 1:45 and then rallied up to a lower high at 5213.50. From there, it sold off down to 5196.25 and then rallied up to 5206.25. 

Part 3 Of the 3 Parts To the Trading Day

After the rally, the ES sold back off down to 5188.25 at 3:00 and did another 3:15 rally back up to the 5215.00 level at 3:28 and then sold off down to 4198.00 at 3:35. From there, it rallied up to 5214.25 at 3:49. The ES traded 5210.75 as the 3:50 cash imbalance showed $139 million to buy, traded up to 5214.25 and traded 5206.25 on the 4:00 cash close. After 4:00, the ES sold off down to 5195.50 and settled at 5103.75 on the 5:00 futures close, down 61.75 points or -1.17%, while the NQ settled at 18,192.75 or -1.06% on the day. 

In the end, the ES moved 82.50 handles in 165 seconds after the number and it was the 4th largest gap down on a CPI day. In terms of the ES's overall tone, it was weak but kept holding the 5190 level. In terms of the ES's overall trade, volume was high: 483k traded on Globex and 1.814 million traded on the day session for a total of 2.297 million contracts traded — its highest volume day in a month.

Technical Edge

  • NYSE Breadth: 17% Upside Volume (!)

  • Nasdaq Breadth: 30% Upside Volume

  • Advance/Decline: 14% Advance (!)

  • VIX: ~16

S&P 500 — ES Futures

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Economic Calendar

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Disclaimer: Charts and analysis are for discussion and education purposes only. I am not a financial advisor, do not give financial advice and am not recommending the buying or selling of any security.
Remember: Not all setups will trigger. Not all setups will be profitable. Not all setups should be taken. These are simply the setups that I have put together for years on my own and what I watch as part of my own “game plan” coming into each day. Good luck!

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