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S&P 500 Buoyed Ahead of Netflix Earnings Report

By:Thomas Westwater

Also, 30-year T-bond, silver, crude oil and Euro futures


  1. S&P 500 E-mini futures (/ES): +0.23%

  2. 30-year T-bond futures (/ZB): -0.49%

  3. Silver futures (/SI): +0.40%

  4. Crude oil futures (/CL): -0.60%

  5. Euro futures (/6J): -0.27%

An earnings beat from Taiwan Semiconductor (TSM) helped to revive market sentiment, pushing the Nasdaq and S&P 500 higher this morning. Labor market data also helped to bolster already dovish bets on Federal Reserve interest rate cuts, with initial jobless claims rising 243,000 for the week ending July 13. That was up about 20,000 from the week before. The dollar is slightly stronger as U.S. yields rise. The European Central Bank (ECB) kept its benchmark rate unchanged overnight. Investors are increasingly focused on corporate earnings figures.


Symbol: Equities

Daily Change

/ESU4

+0.23%

/NQU4

+0.76%

/RTYU4

-0.48%

/YMU4

-0.41%


S&P 500 contracts (/ESU4) moved 0.23% higher this morning, retracing some of yesterday’s losses. We’re now well into earnings season, with Netflix (NFLX) reporting after the bell today. United Airlines (UAL) was up 2% in pre-market trading after the airline reported a profit increase for the quarter. Domino’s Pizza (DPZ) plunged over 13% this morning after the pizza maker missed revenue estimates.

Strategy: (43DTE, ATM)

Strikes

POP

Max Profit

Max Loss

Iron Condor

Long 5590 p

Short 5600 p

Short 5710 c

Long 5720 c

17%

+382.50

-117.50

Short Strangle

Short 5600 p

Short 5710 c

49%

+6737.50

X

Short Put Vertical

Long 5590 p

Short 5600 p

61%

+170

-330


E-mini S&P 500



Symbol: Bonds

Daily Change

/ZTU4

-0.05%

/ZFU4

-0.12%

/ZNU4

-0.18%

/ZBU4

-0.49%

/UBU4

-0.71%


The 30-year T-Bond futures (/ZBU4) fell 0.49% this morning after prices stalled around the June highs as prices along the long-end of the curve moved higher on the Trump trade. The Treasury will auction off 10-year TIPS (Treasury Inflation Protected Securities) today. Bond traders expect to see strong foreign and international demand for the auction.

Strategy (36DTE, ATM)

Strikes

POP

Max Profit

Max Loss

Iron Condor

Long 117 p

Short 118 p

Short 122 c

Long 123 c

44%

+515.63

-4848.38

Short Strangle

Short 118 p

Short 122 c

59%

+1609.38

X

Short Put Vertical

Long 117 p

Short 118 p

75%

+250

-750


T-Bond futures (/ZBU4)


Symbol: Metals

Daily Change

/GCQ4

+0.14

/SIU4

+0.40%

/HGN4

-2.00%


Silver prices (/SIU4) rose 0.40% after plunging 3.44% yesterday—the biggest daily percentage decline since June 21. The drop put the metal below its key exponential moving averages (9-day, 12-day and 21-day), which puts the technical outlook to the downside over the short term. Traders will likely have to wait for the next dollar pullback before attempting to reestablish the uptrend.

Strategy (40DTE, ATM)

Strikes

POP

Max Profit

Max Loss

Iron Condor

Long 29.75 p

Short 30 p

Short 31.5 c

Long 31.75 c

23%

+940

-310

Short Strangle

Short 30 p

Short 31.5 c

56%

+8430

X

Short Put Vertical

Long 29.75 p

Short 30 p

59%

+590

-660


silver


Symbol: Energy

Daily Change

/CLU4

-0.60%

/HOQ4

-0.96%

/NGQ4

+2.36%

/RBQ4

-0.49%


Crude oil prices (/CLU4) fell 0.60% at the New York open as traders digest the most recent data prints on the economy. Russia’s exports fell to the lowest level of the year, bolstering supply-side fears amid broader OPEC cutting. Crude inventories fell in the United States last week, according to a government report. Meanwhile, wildfires around Alberta’s oil sands are forcing some operators, mostly those that pump bitumen, to suspend operations. The WTI prompt spread remains very strong while crack spreads weaken.

Strategy (28DTE, ATM)

Strikes

POP

Max Profit

Max Loss

Iron Condor

Long 79.5 p

Short 80 p

Short 82.5 c

Long 83 c

23%

+370

-130

Short Strangle

Short 80 p

Short 82.5 c

53%

+2780

X

Short Put Vertical

Long 79.5 p

Short 80 p

60%

+190

-310


crude oil



Symbol: FX

Daily Change

/6AU4

+0.10%

/6BU4

-0.27%

/6CU4

+0.01%

/6EU4

-0.27%

/6JU4

-0.39%


Euro futures (/6EU4) fell after the ECB kept its interest rate unchanged today, as expected. ECB President Christina Lagarde said that risks to growth were to the downside, marking a slight change in tone from her previous comments when the ECB cut rates. The ECB meets next in September but the chances for a rate cut there are in doubt amid sticky inflation indicators and slowing growth.


Strategy (50DTE, ATM)

Strikes

POP

Max Profit

Max Loss

Iron Condor

Long 1.08 p

Short 1.085 p

Short 1.1 c

Long 1.105 c

33%

+375

-250

Short Strangle

Short 1.085 p

Short 1.1 c

53%

+1300

X

Short Put Vertical

Long 1.08 p

Short 1.085 p

79%

+162.50

-462.50

euro



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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