Five futures in focus

The S&P 500 and the Nasdaq 100 Have Set Record Closes in 5 Consecutive Sessions

By:Christopher Vecchio - CFA

Also, 10-year T-note, silver, crude oil and British pound futures

Five Futures WTD Performance

  1. Nasdaq 100 E-mini futures (/NQ): +0.41% 

  2. 10-year T-Note futures (/ZN): +0.11% 

  3. Silver futures (/SI): +0.62% 

  4. Crude Oil futures (/CL): +0.12% 

  5. British Pound futures (/6B): +0.16% 

U.S. equity markets (the S&P 500 and the Nasdaq 100) have set record closes in five consecutive sessions, with number six coming together as volatility remains pinned near yearly lows. Bond yields are backing down after investors digested Federal Reserve Chair Jerome Powell’s testimony yesterday. He’ll be back today, this time in front of the House Financial Services Committee. Elsewhere, the pullback in the U.S. dollar and yields may be padding precious metals, while crude oil prices have reversed some of their losses after touching their one-month moving average. 

Symbol: Equities 

Daily Change 

/ESU4 

+0.25% 

/NQU4 

+0.41% 

/RTYU4 

+0.48% 

/YMU4 

+0.07% 

Nasdaq futures (/NQU4) rose after posting a record high yesterday as active investors continue to price in two interest rate cuts from the Federal Reserve. Fed Chair Powell’s testimony yesterday didn’t derail market sentiment. LegalZoom.com (LZ) fell 30% in pre-market trading after the company cut its sales outlook for the year. Earnings season will begin when banks start to report on Friday.  

Strategy: (51DTE, ATM) 

Strikes 

POP 

Max Profit 

Max Loss 

Iron Condor  

Long 19250 p 

Short 19500 p 

Short 22000 c 

Long 22250 c 

64% 

+1235 

-3765 

Short Strangle 

Short 19500 p 

Short 22000 c 

70% 

+4735 

Short Put Vertical 

Long 19250 p 

Short 19500 p 

85% 

+630 

-4370 

/NQU4

Symbol: Bonds 

Daily Change 

/ZTU4 

+0.02% 

/ZFU4 

+0.06% 

/ZNU4 

+0.11% 

/ZBU4 

+0.24% 

/UBU4 

+0.3% 

Treasuries rose across the curve this morning, with the 10-year T-note futures contract (/ZNU4) up 0.11% ahead of the New York open. Prices need to clear 110’275 to forge a path higher. Bond yields fell in Europe overnight as political risk continues to subside. The Treasury will auction 10-year notes today.  

Strategy (48DTE, ATM) 

Strikes 

POP 

Max Profit 

Max Loss 

Iron Condor  

 Long 109 p 

Short 109.5 p 

Short 111.5 c 

Long 112 c 

 40% 

 +296.88

 -203.13

Short Strangle 

Short 109.5 p 

Short 111.5 c

57%

+968.75 

Short Put Vertical 

Long 109 p

Short 109.5 p 

78% 

+140.63 

-359.38 

/ZNU4

Symbol: Metals 

Daily Change 

/GCQ4 

+0.73% 

/SIN4 

+0.62% 

/HGN4 

+0.93% 

Silver prices (/SIN4) were 0.56% higher this morning as traders take advantage of lower yields in the U.S. and Europe. Prices remain lower on the week following last week’s 7.2% gain. Short speculators continued to cover last week through yesterday, according to the Commodity Futures Trading Commission (CFTC) Commitments of Traders report (COT). This week’s inflation data could be a make-or-break report for precious metals. If silver gets a green light, then the 33 handle will be the level to clear for bulls.  

Strategy (48DTE, ATM) 

Strikes 

POP 

Max Profit 

Max Loss 

Iron Condor  

Long 27.5 p 
Short 28 p 

Short 34.5 c 

Long 35 c 

67% 

+625 

-1875 

Short Strangle 

Short 28 p 
Short 34.5 c 

73% 

+3030 

Short Put Vertical 

Long 27.5 p 
Short 28 p 

84% 

+290 

-2210 

/SIU4

Symbol: Energy 

Daily Change 

/CLQ4 

+0.12% 

/HON4 

-0.39% 

/NGN4 

-0.21% 

/RBN4 

-0.68% 

Crude oil prices (/CLQ4) are slightly lower this morning and on track to record a fourth straight daily loss. OPEC kept its demand forecast for crude oil in 2024 the same while revising its economic growth forecast higher. Traders are watching today’s inventory report from the Energy Information Administration (EIA), due this morning. Traders expect to see a draw in oil stocks of about 3 million barrels.  

Strategy (36DTE, ATM) 

Strikes 

POP 

Max Profit 

Max Loss 

Iron Condor  

Long 74 p 

Short 75 p 

Short 87 c 

Long 88 c 

68% 

+230 

-770 

Short Strangle 

Short 75 p 

Short 87 c 

73% 

+950 

Short Put Vertical 

Long 74 p 

Short 75 p 

86% 

+150 

-850 

/CLQ4

Symbol: FX 

Daily Change 

/6AU4 

+0.04% 

/6BU4 

+0.16% 

/6CU4 

+0.05% 

/6EU4 

+0.08% 

/6JU4 

-0.13% 

The U.S. dollar is down vs. most other major currencies today as the backstep in U.S. yields undercuts the greenback—the lone exception being the Japanese yen (/6JU4). The leader on the day is the British pound (/6BU4), which continues to see relief in the wake of last week’s elections amid steadily contracting volatility. As discussed last week, the reduction in British and French political risk may portend an asset class-wide reduction in vol.

Strategy (58DTE, ATM) 

Strikes 

POP 

Max Profit 

Max Loss 

Iron Condor  

Long 1.25 p 

Short 1.26 p 

Short 1.31 c 

Long 1.32 c 

61% 

+187.50 

-437.50 

Short Strangle 

Short 1.26 p 

Short 1.31 c 

68% 

+443.75 

Short Put Vertical 

Long 1.25 p 

Short 1.26 p 

87% 

+112.50 

-512.50 

/6BU4

Christopher Vecchio, CFA, tastylive’s head of futures and forex, has been trading for nearly 20 years. He has consulted with multinational firms on FX hedging and lectured at Duke Law School on FX derivatives. Vecchio searches for high-convexity opportunities at the crossroads of macroeconomics and global politics. He hosts Futures Power Hour Monday-Friday and Let Me Explain on Tuesdays, and co-hosts Overtime, Monday-Thursday. @cvecchiofx

Thomas Westwater, a tastylive financial writer and analyst, has eight years of markets and trading experience. @fxwestwater

For live daily programming, market news and commentary, visit tastylive or the YouTube channels tastylive (for options traders), and tastyliveTrending for stocks, futures, forex & macro. 

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