Thursday's E-Mini S&P 500 futures (Es) auction wasn't particularly exciting. Volume was about average. Breadth was OK. And intraday travel (distance from the regular-session high to low) amounted to nearly 30 handles. In a nutshell, while day time-frame traders should have been able to identify numerous intraday trading opportunities, zero actual progress was made toward pushing the Es into a more directional state.
Away from the relative calm of the Es auction, we saw plenty of action in a number of individual equities. Conoco Phillips (COP) slashed its dividend and proceeded to plunge 8.5%. Holders of Kohl's (KSS) and Ralph Lauren (RL) were crushed with losses of between 19% and 22%. And residual pain was felt across the retail sector with L Brands (LB) declining nearly 7%, Nordstrom (JWN) sliding more than 6% and Nike (NKE) giving back roughly 3.7%.
On a more bullish note, an impressive number of basic materials, industrial and service-oriented stocks made strong gains. Freeport-McMoRan (FCX) popped nearly 18%. Alcoa (AA) rallied 10%. Fastenal (FAST), Ryder Systems (R), Cummins (CMI) and Vulcan Materials (VMC) all gained between 6.5% and 9.8%.
As far as Thursday's winners are concerned, I suspect it's premature to get overly excited about some of the gains noted above. Let's face it, seeing a stock like FCX rally 18% yet still close beneath 6 bucks a share is hardly impressive. Can a stock like Freeport or AA rally further? Absolutely. But have they established strong and impressive bases to push higher from over a higher time frame? No, not in my view.
No discussion of big moves in individual equities would be complete without a quick comment on LinkedIn (LNKD) and Tableau Software (DATA). Both of these companies reported earnings after the bell Thursday, and both were taken out back and shot. We all know the risks associated with owning momentum-oriented growth stocks. But the degree of selling in both names during Thursday's after-hours session was truly spectacular.
As far as potential support is concerned, LNKD has support around $136 dating back to early May 2014. Any continued selling would likely send the stock all the way to $104-$107 (the most actively traded zone since the stock came public in May 2011).
DATA crashed to all-time lows during Thursday's after-hours session. So barring a stunning recovery back above $52-$55, this is not a stock I'd consider owning outside the day time frame (assuming one were an intraday scalper).
Moving on to Friday's Es auction, keep in mind the premarket employment data could result in the contract opening significantly away from Thursday's 1907.75 regular-session close, but we'll begin the session with a primary focus on 1890. As long as we're trading above that figure, our baseline expectation will be for two-way rotational activity toward 1921. A sustained trade above 1921 returns our focus toward 1933 and 1945.
A failed trade from 1890 dramatically increases our odds of probing levels beneath 1873.50, and back down toward Wednesday's 1865 intraday low. My overall expectation would be for any shift in value beneath 1890 to ultimately result in a retest of the mid-1860s.
Any trading or volume profile related questions can be posted in the comments section below, emailed to me at email@example.com or posted to my Twitter feed @ByrneRWS