E-mini S&P (December) / E-mini NQ (December)

S&P, yesterday’s close: Settled at 5778.00, up 98.00

NQ, yesterday’s close: Settled at 20,088.00, up 507.00

U.S. equities went gangbusters yesterday, with the E-mini S&P and E-mini NQ gaining 1.7% and 2.6%, respectively. The move comes on the heels of the Federal Reserve cutting rates by 50bps and markets finishing on session lows in the aftermath. We noted here that despite heavy selling pressure through Fed Day, benchmarks did not break a critical floor of support that developed on Monday and Tuesday. To some respect, what was increased to rare major four-star support at 5675.25-5680 in the E-mini S&P and 19,525-19,580 became a launchpad for yesterday’s melt-up.

Likely stoking the rip was today’s Quadruple (Triple) Witching, where futures, options on futures, and options on securities expire (the three). Individual stock futures also expire on this day but now have little to no impact (hence why Quadruple). Those associated with futures expire at 8:30 am CT; we fear this could bring some near-term exhaustion heading into next week. This exhaustion would come just after the E-mini S&P set a fresh record high, trapping bulls, but failed to close above rare major four-star resistance at 5781.25-5785 and the E-mini NQ tests, but has not broken out above its late August peak. Our Pivot and point of balance is highlighted below and will be critical as the session plays out; surrendering this mark would encourage a shift in near-term momentum. We have layers of major three-star support below….

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