S&P 500 Hold Gains to Start Quiet Holiday Trading Week
S&P 500 Hold Gains to Start Quiet Holiday Trading Week
Also two-year T-note, gold, crude oil and Japanese yen futures
- S&P 500 E-mini futures (/NQ): +0.19%
- Two-year T-note futures (/ZT): -0.05%
- Gold futures (/GC): -0.03%
- Crude oil futures (/CL): +2.64%
- Japanese yen futures (/6J): +0.04%
Traders are looking at a quiet week for U.S. markets as we close the final week of trading out. The S&P 500 (/ESH4) is trading slightly above 4,800 after last week’s rally that finished the longest weekly win streak in over five years. There aren’t any high-impact events scheduled for this week, which leaves prevailing sentiment trends to go unchecked. Light liquidity and low trading volumes may leave equity indexes to trade in a thin range.
Symbol: Equities | Daily Change |
/ESH4 | +0.19% |
/NQH4 | +0.34% |
/RTYH4 | +0.32% |
/YMH4 | +0.05% |
The four major U.S. indexes opened higher this morning but E-mini Dow futures (/YMH4) struggled in the group, opening flat on the day. A U.S. home price gauge showed the ninth monthly rise in house prices, and the Federal Reserve’s Chicago National Activity Index improved in November from the month before. Meanwhile, markets continue to price in a March rate cut from the Fed, per Federal funds futures.
Strategy: (36DTE, ATM) | Strikes | POP | Max Profit | Max Loss |
Iron Condor | Long 4770 p Short 4775 p Short 4860 c Long 4870 c | 55% | +295 | -205 |
Long Strangle | Long 4770 p Long 4870 c | 50% | x | -4,850 |
Short Put Vertical | Long 4770 p Short 4775 p | 61% | +87.50 | -162.50 |
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Symbol: Bonds | Daily Change |
/ZTH4 | -0.05% |
/ZFH4 | +0.00% |
/ZNH4 | +0.06% |
/ZBH4 | +0.33% |
/UBH4 | +0.40% |
Two-year Treasury note futures (/ZTH4) fell 0.06% this morning. That pushed its yield up by about four basis points, or 1.11%, to 4.375%. The U.S. Treasury will auction $57 billion worth of the two-year notes this afternoon. Bond traders will also be watching several auctions tomorrow, including one for five-year notes. Weak demand could push yields higher, which may drag on markets that are more susceptible to movements amid lighter volumes.
Strategy (59DTE, ATM) | Strikes | POP | Max Profit | Max Loss |
Iron Condor | Long 102.375 p Short 102.5 p Short 103.125 c Long 103.25 c | 20% | +187 | -62.50 |
Long Strangle | Long 102.375 p Long 103.25 c | 56% | x | -921.88 |
Short Put Vertical | Long 102.375 p Short 102.5 p | 88% | +93.75 | -156.25 |
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Symbol: Metals | Daily Change |
/GCG4 | -0.03% |
/SIH4 | -0.24% |
/HGH4 | +0.32% |
Gold futures (/GCG4) are down slightly this morning as bond selling pushing yields slightly higher across the short- and middle-end of the curve. Volatile tensions in the Middle East and a major military operation in occupied Ukraine failed to spur any haven buying in precious metals overnight. Silver futures (/SIH4) slide lower, falling about 0.65% against gold’s 0.10% loss.
Strategy (34DTE, ATM) | Strikes | POP | Max Profit | Max Loss |
Iron Condor | Long 2050 p Short 2055 p Short 2105 c Long 2110 c | 25% | +380 | -120 |
Long Strangle | Long 2050 p Long 2110 c | 42% | x | -3,940 |
Short Put Vertical | Long 2050 p Short 2055 p | 62% | +220 | -280 |
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Symbol: Energy | Daily Change |
/CLF4 | +2.76% |
/HOH4 | +1.93% |
/NGF4 | -3.98% |
/RBH4 | +1.84% |
Crude oil prices (/CLG4) moved higher today as reports of explosions in the Red Sea triggered some buying in the commodity. The United Kingdom Maritime Trade Operations stated that two drones were seen shortly before several explosions were heard by a vessel off the coast of Yemen. Earlier today, however, shipping giant Maersk said it would resume operations in the Red Sea and Gulf of Aden. Other shippers’ operations are still suspended but several other companies said they will make decisions over the coming days to resume travel through the corridor, where a U.S.-led coalition is operating to deter attacks.
Strategy (50DTE, ATM) | Strikes | POP | Max Profit | Max Loss |
Iron Condor | Long 73.5 p Short 74 p Short 78.5 c Long 79 c | 19% | +380 | -120 |
Long Strangle | Long 73.5 p Long 79 c | 48% | x | -4,810 |
Short Put Vertical | Long 73.5 p Short 74 p | 57% | +200 | -300 |
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Symbol: FX | Daily Change |
/6AH4 | +0.19% |
/6BH4 | +0.13% |
/6CH4 | +0.44% |
/6EH4 | +0.14% |
/6JH4 | +0.03% |
Japanese yen futures (/6JH4) are nearly unchanged this morning, trading around the five-month high on speculation that the Bank of Japan (BOJ) will soon exit its ultra-loose monetary policy stance. With markets closed in Australia, Hong Kong and New Zealand, foreign exchange markets are also trading on lighter-than-normal volumes because of public holidays. The BOJ’s Ueda signaled that Japan was exiting its period of low inflation, adding to signs that the bank is on the verge of a major shift.
Strategy (45DTE, ATM) | Strikes | POP | Max Profit | Max Loss |
Iron Condor | Long 0.007 p Short 0.00705 p Short 0.0072 c Long 0.00725 c | 30% | +437 | -187.50 |
Long Strangle | Long 0.007 p Long 0.00725 c | 42% | x | -1,375 |
Short Put Vertical | Long 0.007 p Short 0.00705 p | 68% | +265 | -362.50 |
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Thomas Westwater, a tastylive financial writer and analyst, has eight years of markets and trading experience. @fxwestwater
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