Posts by Rod David
Post-market Wrap (recording & summary)
Tuesday left “unfinished business below” from oversold RSIs at 2262.25 coming out of the afternoon bias environment. The dip at that time was seeking strong-handed buyers to sponsor resuming the rally — they weren’t attracted by gapping up and extending higher to 2269.50, so a pullback was attracted down to 2262.00.
The dip stopped optimistically short before bouncing to 2267.50 into the close, too late to be strong-handed sponsorship, and too little to prevent a deeper overnight dip. The afternoon bias environment had already peaked there, so only returning to it did not reflect strong-handed buyers.
Gapping up Wednesday above Tuesday’s 2269.50 high could prevent a deeper dip, and already be back on-track to probing the new highs above 2273.00. Otherwise, breaking under Tuesday’s 2262.25 low would have only a brief opportunity to snap back up, or else start seeking buyers below 2260.50.
Details and other markets coverage are discussed in the post-market Wrap recording here.
Monitor overnight Globex trading in the chaRTroom here.
Daily Spot…
A daily summary of high-profile members of several complexes… View a more detailed discussion of each chart at the end of today’s Market Wrap.
Eurodollar Mar Contract (EC, ETF: (FXE, UUP))
Tuesday’s gap down retested the 1.0410 lowest calculable objective that had held already last week. Bouncing back up to 1.0435 avoided a second consecutive close under it that would have required the decline to extend. Almost any initial strength Wednesday morning would be credible for extending higher intraday.
Gold Feb Contract (GC, ETF: (GLD))
The corrective bounce’s 1136.50 signal had triggered artificially and wasn’t immediately rejected, giving a benefit of the doubt to extending the bounce. It didn’t. Tuesday’s break back under 1136.50 doesn’t prevent the bounce from extending, but it opens the door as widely to simply extending down to the 1118.00 objective still in-play..
Silver Mar Contract (SI, ETF: (SLV))
Gapping down sharply Tuesday fulfilled the 15.66 to within 1 penny and reversed up sharply back into positive territory. The opening gap below must still be tested from above, and it’s premature to expect a durable rally leg, but this action does allow a bottom to begin forming..
30-year Treasury Mar Contract (US, ETF: (TLT))
Tuesday’s gap down within Monday’s range didn’t reject Monday’s gap up, so even the price weakness reflects optimism that is only delaying fulfilling the outstanding requirement for at least one more lower close, and probably making a more substantial new low likely..
Crude Oil Jan Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Gapping up slightly Tuesday to test 53.75 didn’t extend, and was retraced to fill the gap back down to Monday’s ~53.10 close. While a positive close would fulfill the minimum requirement of Friday’s sub-optimal breakout, a retest of last Sunday night’s 54.90-55.30 highs remains outstanding..
Natural Gas Jan Contract (NG, ETF: (UNG, UNL))
Sunday night’s dip to 3.33 had been retraced before Monday’s open but never rejected intraday, so trending down deeper into Tuesday’s open helped confirm the 3.19 target is in-play, already testing 3.24 intraday..
Mid-day Update… New heights of complacency.
Hovering at fresh relative highs.
The overnight rally began with Europe’s opens triggering a break above 2262.00. It ended with the open’s surge up to 2269.50. That was the open. the balance of the morning worked its way back down to 2263.50.
Firming through the noon hour is retesting what had been this morning’s 2267.25 bias-up signal. Its resistance was obviously influential then, and it/s clearly influential now. Its test is also not reversing down.
RSIs are stuck and not reflecting any sponsorship. This hesitation isn’t so close to the 2273.00 high to be labeled “pessimism,” but it is bordering on being “complacency.” Still not rallying out of the bias environment would try attracting strong buyers below at 2260.50-2262.00.
Look ahead: Economic Calendar – for Wed Dec 21, 2016
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: Wednesday’s first two econ reports speak to the housing sector, which gave mixed signals last week — optimism is up among builders, while interest rates are up for buyers. The mid-morning EIA report greets a Crude Oil market starting to recover from a pullback, with a retest of the prior Sunday night’s gap up outstanding.
MBA Mortgage Applications
7:00 AM ET
Existing Home Sales
10:00 AM ET
EIA Petroleum Status Report
10:30 AM ET
Afternoon Bias
| TUE afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 2272.00 | 2268.50 |
| …would target | 2277.00 | 2273.50 |
| Bias-down: under | 2266.50 | 2263.00 |
| …would target | 2259.75 | 2256.25 |
| Signal status: NO-BIAS | FAQ | |
| INTRO VIDEOS #1 and #2 | ||
1. At 1:20, trading above the bias-up signal or under the bias-down signal would put into play a test of its bias-up or bias-down target.
2. Not triggering either bias signal at 1:20 would be “no-bias,” and the bias signals should define the bias environment’s range.
— A test of the opposite bias signal would be targeted if one bias signal was tested before triggering no-bias.
3. Touching the bias signal within 3 minutes either way of 1:20 would invoke a grace period through 1:30 to trigger a late signal.
— “Late” signals don’t require testing the opposite bias signal, but it’s still likely.
4. Still testing the bias signal at 1:30 after invoking the grace period would trigger “noN-bias,” with no bias influence.