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The PitBull Smelled It Coming — Fed Hike, Late Bounce, Now Don’t Trust the Rip
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If you asked me if I was surprised by the sell-off, I would have to say no, but I would also say it's all part of the new normal. I don't know who it was, but the PitBull said someone on CNBC was saying three more rate hikes this year.
That said, I was quick to point out the weakness in the NQ while the ES was still trying to hold, but the JPM headline was definitely a turning point. As I have said in the past, if you have been reading the OP for a long time, it's more about the tone of what I am writing than the actual lean.
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The ES traded in a 7658.75 to 7689.25 Globex trading range with 210k contracts traded and opened Wednesday's 9:30 ET regular session at 7676.50, up 19.50 points or +0.25%.
After the open, the ES traded 7679.00, sold off 10.00 points down to 7669.00, rallied 17.60 points up to 7686.60, and made two higher lows at 7669.50 at 10:15 and 7670.00 at 10:30. Itrallied 22.75 points up to 7692.75 at 11:00, sold off 10.75 points down to 7682.00, rallied 17.00 points up to 7699.00 at 11:45, sold off 25.00 points down to 7674.00 at 1:00, and rallied up to 7684.75 at 1:45.
The ES initially rallied after the Fed raised rates by 25 bps, then sold off 15.75 points down to 7669.00 at 2:00, rallied 25.25 points up to 7694.25 at 2:05, and then sold off 53.25 points down to 7641.00 at 2:40. It rallied 42.25 points up to 7683.25 and then sold off 66.25 points down to 7617.00 at 3:01 after this showed up on Twitter: JPMorgan stocks down 1.25%–1.75% as long-term yields rise. The biggest risk is guidance suggesting rates must remain “materially higher” to defeat inflation. JPMorgan estimates that could trigger a 1%–2% S&P 500 decline, potentially threatening the current rally.
After the drop, the ES rallied back up to 7634.00 at 3:00, sold off 53.50 points down to 7580.50 at 3:22, rallied 36.26 points up to 7616.76 at 3:49, and traded 7615.00 as the 3:50 cash imbalance showed $1.3 billion to sell, rallied up to 7625.00, and traded 7622.00 on the 4:00 cash close.
After 4:00, the ES traded up to 7625.75, pulled back to the 7617.25 level, and settled at 7623.00, down 33 points or -0.43%; the NQ settled at 29,256.75, up 10 points or +0.03%; the YM settled at 51,915, down 611 points or -1.16%; and the RTY settled at 2882.50, down 12.20 points or -0.42% on the day.
“The Fed’s 25-basis-point hike hit the old-economy Dow much harder than the tech-heavy Nasdaq. Banks, industrials, and energy took the brunt of the selling as Treasury yields jumped, while AI and mega-cap tech held up, leaving the Nasdaq nearly unchanged.”
In the end, everything was OK until after the rate hike 'pop,' when the JP Morgan headline hit and the NQ started to reverse. It was all sell programs and sell stops. In terms of the ES’s overall tone, the ES and NQ reversal was stark. In terms of the ES’s overall trade, volume was just a shade higher from Tuesday's at 1.732 million with around 350k spreads traded.
What to See Something SCARY? 2 Yr Note Pays 4.73%
MiM
MOC Recap: Sell Program Builds Into a Broad Closing Wave
The MOC opened with a $1.6 billion for sale, with $2.6 billion to buy against $4.1 billion to sell. The dollar lean was -61.7% and the symbol lean was -61.4%, showing a broad sell bias, though still more rotational than a true wholesale liquidation at that point.
Selling remained dominant throughout the closing window. The imbalance improved to $1.3 billion for sale at 3:55 before deteriorating to $1.8 billion for sale at 3:56. It then eased back toward $1.1 billion late in the session, with the final 4:00 print coming in at $1.3 billion for sale. More importantly, the final dollar lean plunged to -84.9% and the symbol lean to -76.2%, clearly signaling a wholesale sell program into the closing bell.
Technology carried the largest sector pressure, with Information Technology showing a $554.7 million sell imbalance. Consumer Discretionary followed at $270.0 million for sale, Industrials at $269.5 million for sale, and Financials at $229.4 million for sale. Industrials were particularly notable with a -72.9% dollar lean and -67.2% symbol lean. Materials were even more one-sided at -80.4% dollars and -66.7% symbols, while Real Estate posted a -73.9% dollar lean. Energy also crossed the wholesale threshold at -67.7%. Communication Services stood out on the buy side with a $153.6 million buy imbalance and a +65.2% dollar lean.
On the symbol side, NVDA dominated the sell list with a $431.0 million sell imbalance, followed by BRK.B at $160.4 million, MU at $135.8 million, GOOG at $133.8 million, HD at $125.8 million, and MCD at $125.1 million.
Buyers concentrated in MSFT at $133.6 million, GOOGL at $110.2 million, GILD at $89.5 million, and INTC at $88.4 million.
The key takeaway: what began as a rotational sell imbalance transitioned into a broad, aggressive wholesale sell program at the close.
Daily Breadth Data 📊
For Wednesday, September 16, 2026
NYSE Breadth: 28% Upside Volume
Nasdaq Breadth: 58% Upside Volume
Total Breadth: 48% Upside Volume
NYSE Advance/Decline: 40% Advance
Nasdaq Advance/Decline: 40% Advance
Total Advance/Decline: 40% Advance
NYSE New Highs/New Lows: 46 / 204
Nasdaq New Highs/New Lows: 84 / 396
NYSE TRIN: 1.68
Nasdaq TRIN: 0.48
Weekly Breadth Data 📈
For the Week Ending Friday, September 11, 2026
NYSE Breadth: 40% Upside Volume
Nasdaq Breadth: 49% Upside Volume
Total Breadth: 45% Upside Volume
NYSE Advance/Decline: 23% Advance
Nasdaq Advance/Decline: 27% Advance
Total Advance/Decline: 25% Advance
NYSE New Highs/New Lows: 107 / 443
Nasdaq New Highs/New Lows: 219 / 608
NYSE TRIN: 0.45
Nasdaq TRIN: 0.38
Today’s Economic Calendar
PTG Room Summary – For Wednesday, September 16, 2026
Wednesday’s session developed as a failed Cycle Day 3 in ES. Overnight weakness completed the previously identified 7650 downside objective, and the key test for the regular session was whether ES could reclaim the 7703.50 Cycle Day 1 Low. It never accomplished that mission, while intraday price action remained choppy and rotational, giving the session more of a Cycle Day 2 feel. The best opportunities came from recognizing support, waiting for strength to return, and trading the reversal rather than pressing shorts into established support.
Overnight setup and primary objective
Overnight selling extended the prior session’s weakness and fulfilled the 7650 downside objective from the Daily Trade Strategy.
PTGDavid identified the primary Cycle Day 3 objective as reclaiming the 7703.50 Cycle Day 1 Low.
Failure to regain 7703.50 was an important warning that trapped longs could remain under pressure.
The execution message remained consistent: take only Triple-A setups, manage risk, use hard stops, and stay aligned with the dominant force.
Morning price action
ES did not immediately provide an Opening Range trigger, while traders noted divergence between NQ and ES.
The market repeatedly respected the 7655 area, making fresh shorts into that support increasingly unattractive.
The early session became highly rotational, with quick moves away from support followed by returns toward the open.
Several traders commented that the session behaved more like a Cycle Day 2 than a traditional directional Cycle Day 3.
Positive trade opportunity
One of the better setups developed around the overnight low and the 7651.75 Money Box area.
PTGDavid’s commentary highlighted the possibility of a Peek-a-Boo-style long from the overnight low.
The trade improved once price reclaimed the Money Box area, providing evidence that buying strength was returning.
A room member reported deliberately waiting for an entry slightly above 7651.75 rather than trying to catch the exact low.
The resulting long was well received in the room, with favorable comments about both the trade and the runner.
This was a strong example of allowing the market to confirm the reversal before committing capital.
Midday influences
Treasury-market news added another volatility factor when a reported $6 billion Treasury buyback came in below the roughly $10 billion some participants had expected.
The disappointment was associated with a sharp move higher in the 10-year yield.
Despite these outside influences, the better trading lesson remained centered on price structure rather than predicting headlines.
Cycle outcome
By the afternoon, ES had officially produced a Failed 3-Day Cycle because it could not reclaim the 7703.50 Cycle Day 1 Low.
NQ did manage to reclaim its corresponding Cycle Day 1 Low, creating an interesting divergence between the two markets.
PTGDavid noted that the shortened holiday session may have disrupted the normal cycle rhythm.
The group observed that the market’s back-and-forth behavior was much more characteristic of a Cycle Day 2.
The expectation remained that the cycle process would eventually self-correct.
Key trading lessons
Do not force shorts directly into repeatedly defended support simply because the broader market has been weak.
Confirmation can be more valuable than getting the absolute best entry price. Waiting for the 7651.75 Money Box reclaim gave evidence that strength was returning.
A five-point trade does not require catching the exact high or low; execution quality matters more than perfect positioning.
Averaging or adding exposure is substantially safer when the market is already moving in your favor rather than using size to rescue a losing position.
When the expected cycle behavior does not appear, recognize the change instead of trying to force the market into the original roadmap.
Opening Range signals, Money Box levels, overnight lows, ATR references, and cycle structure are most useful when several pieces of evidence align.
The session reinforced PTG’s Primary Directive: remain aligned with the dominant force and let the market confirm the setup.
Looking ahead
The unresolved question is whether ES can recover the 7703.50 Cycle Day 1 Low following the failed Cycle Day 3.
PTGDavid highlighted 7620–7618 as an important downside pivot zone if overnight weakness continues.
A move below that zone followed by a quick recovery could create another Peek-a-Boo Long opportunity.
The close offered little additional information, with MOC essentially flat.
DTG Room Preview – For Thursday, September 17, 2026
Macro & Rates
Global bonds are recovering, but rates remain the dominant macro driver after the Fed raised the target range by 25 bps to 3.75%–4.00%.
Strong U.S. consumer data continues to point to economic resilience while keeping inflation concerns elevated.
Expect continued sensitivity to Treasury yields, the dollar, Fed commentary, and shifting expectations for additional tightening.
Overnight trade has already retraced much of Wednesday’s post-FOMC ES decline, which could compress regular-session volatility.
Trade & Geopolitics
U.S.–Canada trade tensions remain a market risk, with the White House directing officials to restrict Canadian-origin goods within federal procurement where permitted by law.
U.S.–China tariff discussions provide a potential positive offset, while Taiwan-related tensions remain a headline risk.
Iran, Ukraine, Israel, the West Bank, and political headlines remain potential volatility catalysts.
Energy & Sector Rotation
Crude remains under pressure as improving supply conditions ease some inflation concerns.
Airline schedule reductions highlight continued margin and planning pressures across transportation and travel.
Energy, transportation, and small caps remain areas to watch for continued sector dispersion.
AI, Tech & Regulation
AI semiconductor demand remains in focus following commentary from Bank of America, with NVDA and INTC key names to watch.
Regulatory pressure remains a potential NQ catalyst, particularly across AI and megacap technology.
Concentrated leadership in AI-linked stocks leaves NQ especially sensitive to company-specific and regulatory headlines.
Today’s Catalysts
Earnings: FDX after the close.
8:30 AM ET: Philly Fed Manufacturing, Weekly Jobless Claims, Building Permits, Housing Starts.
10:00 AM ET: Pending Home Sales.
Watch Treasury yields, crude, Fed commentary, trade headlines, and geopolitical developments.
ES Outlook & Levels
Whale bias is slightly bullish into the U.S. open on elevated overnight large-trader volume.
ES rebounded back inside its short-term downtrend channel after briefly breaking below it following the FOMC decision.
The 50-day MA at 7705.75 has capped the high for two consecutive sessions and remains an important resistance test.
Trendline resistance: 7770/65, 7960/65.
Trendline support: 7618/15, 7570/65, 7405/10.
Wednesday’s 7570/65 area is being treated as a new short-term swing-low zone, while 7780/75 remains the upper channel resistance area.
