Posts by Rod David
Post-open Review… Influence on.
Early surge finally extends higher.
The overnight rally to 2260.75 created room to expend selling pressure without it yet damaging the chart. Pre-open action had pulled back to 2256.00. Holding 2255.00 post-open would have been optimal. Ultimately, the gap back to Friday’s 2254.00 cash session close was touched.
And then price shot higher. The opening 15 minutes of volatility to resolve up aggressively. This was an early clue to confirming a bullish WedEX influence remained alive for this morning.
The next clue did not develop, as bias-up did not trigger. More so, a post-open test of the 2260.25 bias-up signal held, putting into play an offsetting test of the 2251.25 bias-down signal. No grace period was invoked, and fresh highs through 10:30 didn’t invalidate the bias signal.
But fresh highs did print after 10:30. And the pattern’s 2259.75 buy signal got a benefit of the doubt from the bullish WedEX. That has extended up to 2263.50.
No matter how productive, the bullish WedEX lapses along with this morning’s bias environment at 11:30. And that’s now within view just 10-15 minutes away. The 2251.25 bias-down signal’s test will become “unfinished business below” unless the noon hour is entered above this morning’s 2267.25 bias-up target.
Pre-market Tour (recording & summary)
Sunday night’s opening surge had been consolidating in a relatively narrow, choppy range down to 2257.00. That’s been probed by another point, albeit only temporarily so far. Regardless of the opening print, the opening 15 minutes of volatility should make clear whether this morning will be influenced by a bullish WedEX.
Details and other markets coverage are discussed in the pre-market Tour recording here.
The First Trade… Complacently waiting.
Proper context can start the day with a solid win and make all the difference.
CHARTROOM LINK
(pre-open Market Tour begins at 8:55 ET)
Through the prior close…
Friday’s quadruple witch expiration open gapped up to only attack the 2264.00 overnight high, which was also the morning’s bias-up signal. Price almost immediately began trending down, extending to test 2250.00 as support coming out of the noon hour. The decline stopped there, as the bullish WedEX would begin influencing price at the bias environment’s entry. Although no new low printed, bounces up to 2255.00 never actually reversed the trend up as a president’s press conference grabbed attention.
Overnight action’s new info…
Opening flat with Friday’s 2255.00 close lasted only several seconds before surging to 2259.50. The surge lasted only several seconds before it stopped, suddenly. And durably. Choppy sideways ranging since the open’s surge has been relatively narrow, contained between 2257.00-2261.00. The lower-end is now being retested.
If, then…
The open’s surge suggests that Friday’s ranging at session lows was actually pent-up buying pressure. That would comport with the assumption that bullish WedEX was inhibited by coinciding with the president’s press conference. That doesn’t assure gapping up, or avoid gapping down, And only the opening action can offer any further assurance of the bullish WedEX influencing this morning’s action. If it does, then price should trend up, possibly aggressively. Not already rallying obviously past the open could suggest no bullish influence, and open the door to resolving “unfinished business below” at 2243.00.
First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 above 2261.50 would be likely to trigger the 2260.50 bias-up signal at 10:15. Exiting the open under 2257.50 would be unlikely to trigger bias-up.
Link to monitor the Globex open…
The world wasn’t exactly quiet this weekend, but neither was it generally raucous and uncontrolled. There’s a new high-profile bearish opinion circulating, and nothing bullish at the moment to offset it directly. So, a mixed open seems likely, almost rudderless — which also means vulnerable to any overnight developments. We’ll soon see, or at least start seeing, as the overnight Globex session opens at 6:00pm ET.
Saturday Review’s recording (for 12/17/16) …
Next week’s issue of Barron’s was published this morning, and its Up & Down Wall St. column headline nails it: “Everyone’s Optimistic. Is It Time to Worry?” From a contrarian perspective, that’s almost too late to only begin worrying. But the contrarian perspective also applies to Barron’s lead opinion piece. If they think everyone’s optimistic, then maybe it’s actually too early to start worrying.
Meanwhile, the actual chart still has unfinished business above back at Tuesday’s 2273.00 high. It also has room for a correction down to 2215.00 and 2205.00. Trying to reach one before the other may be a function of the impending seasonal bullish — helping a pullback to recover, or greeting next weekend already in decline. Monday’s second-half of the WedEX signal should be heard from, first.
These influences and others are described during this weekend’s Saturday Review..Get caught up on the market’s likely paths and resolutions before the new trading week begins…