The usual overnight low-volume ramp job — this one into a flag pattern that got ES back to the falling red channel midline and backtested the broken white 1.618 Fib.
So, last Friday, I’m channel surfing and hear an unbelievable rant from everyone’s favorite cheerleader Jim Cramer:
You know what? I’m getting pretty darned tired of the tyranny of the S&P futures, where the market gets hammered from the get-go for no particular reason. And people panic simply because they figure those futures traders must know something.
He goes on to exhort his followers to ignore the futures action and buy the dip because Monday (yesterday) would be up big…but, that’s another story.
The part that flabbergasted me was the notion that low-volume overnight futures trading was somehow unfairly depressing the markets. This was the same day another CNBC bobble-head (Pisani) was going on about how investors should ignore the ugliness in the DJIA since it was more sensitive to disappointing earnings reports than was the SPX (we wouldn’t want earnings to affect stock prices, would we?)
So, I was excited to tune in this morning and hear him rant about the futures action unfairly propping up prices overnight…except it didn’t happen. In fact, it never happens. In all the years I have suffered through MSM coverage of the stock market, I don’t think I’ve ever heard anyone talk about the nightly ramp job that has become a staple of the market.
In the past week alone, the futures have ramped higher 5 out of 7 times. It’s almost a certainty after a big decline during market hours, as last night’s action demonstrates.
A reminder to our readers: CNBC and its ilk exist simply to display ads paid for by you when you patronize the firms whose continued existence relies on an ever-increasing market. When the market goes up, it’s proof that all is well in the economy. When the market goes down, it’s just the market taking a breather after rising so much, so fast. Or, so they say.