Posts by Rod David
Morning Bias
| THU morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2261.75 | 2256.75 |
| …would target | 2268.75 | 2264.00 |
| Bias-down: under | 2251.50 | 2246.75 |
| …would target | 2245.75 | 2240.75 |
| Signal status: BIAS-UP, BIAS-UP TARGET MET | FAQ | |
| INTRO VIDEOS #1 and #2 | ||
1. At 10:15, 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 10:15 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 10:15 would invoke a grace period through 10:30 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 10:30 after invoking the grace period would trigger “noN-bias,” with no bias influence.
Post-market Wrap (recording & summary)
Wednesday’s deep post-FOMC drop from 2272.50 probed at least twice under Monday’s 2247.00 low. The tests held through the close — or, at least, Wednesday’s close was not below them. That keeps price in the interim high’s orbit, and keeps the door open to retesting it.
It doesn’t have to be retested. There already was no “unfinished business above” coming into Wednesday’s session. Higher attractions were created intraday, but already neutralized. The last one was the 2271.75 bias-up target, which was pierced by 3 ticks at the high.
Two other reasons for retesting Wednesday’s 2272.50 high are (1) it stopped pessimistically short of touching Tuesday’s 2273.00 high, which can be bullish from a contrarian perspective, and (2) the high formed a Symmetrical Triangle, a pattern which often reverses more substantially from a false break.
Wednesday’s high is already far above, and that’s just as of Wednesday’s close. Bouncing off of oversold RSIs at 2243.00 recovered to 2260.00 but fell back to 2245.00 before the close. A fresh low overnight would neutralize the attraction to retest 2243.00 — already recovering it into Thursday’s open would be a good start at retesting Wednesday’s high. Otherwise, that multi-session pullback targeting 2215.00 and 2205.00 is underway.
Details and other markets coverage are discussed in the post-market Wrap recording here.
Monitor overnight Globex trading in the chaRTroom here.
Pre-close View… Wide ranging reaction.
FOMC statement is out. Fed chair is on.
The FOMC news was greeted at 2268.50. A knee-jerk reaction down to 2262.50 reacted up to a fresh session high at 2272.50. Attacking yesterday morning’s high to within 3 ticks then reversed down sharply to 2258.00 and 2252.00 taking both RSIs oversold both times.
3-minute RSI was not oversold on the low’s retest down to 2251.50. Its reaction stopped 1 tick short of the 2257.25 buy signal that would have targeted fresh session highs. Now fresh lows are testing 2243.00, and RSIs are again oversold.
Yellen seems to be passing that point in her Q&A where nothing shocking is left to ask or to say. Back above 2253.50 would start to signal the drop was done, and momentum is reversing up. The objective would be to probe fresh highs above 2273.00 — not necessarily today, and probably not by just a little, thanks to a much deeper interim dip. Otherwise, fresh lows would be vulnerable to extending down into the close.
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 Dec Contract (EC, ETF: (FXE, UUP))
Continuing to hover just under the 1.0685 bounce limit Wednesday morning was finally rejected in reaction to the afternoon’s FOMC policy statement. Plunging essentially filled the gap back down to Friday’s 1.0556 close. Regardless, at least one more eventual low close remains outstanding.
Gold Feb Contract (GC, ETF: (GLD))
Gapping up Wednesday to 1162.00 extended higher briefly to 1168.00, but greeted the afternoon’s FOMC statement back down at 1162.00. Its reaction spiked down to new lows at 1150.00, next targeting 1142.00 if not isolated by Thursday’s open, but even then.
Silver Mar Contract (SI, ETF: (SLV))
Wednesday’s open gapped up to the 17.05 buy signal and extended back to prior highs above 17.25. But the FOMC triggered a plunge down to 16.90 that must be recovered back above 17.05 at Thursday’s open to isolate it.
30-year Treasury Mar Contract (US, ETF: (TLT))
Gapping up Wednesday ranged all morning around Tuesday’s test of the 149-22 bounce limit, probing above 150-00. Plunging in reaction to FOMC probed negative territory at 148-22, with a new low close requirement still outstanding.
Crude Oil Jan Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Gapping down Wednesday was the lowest price since Sunday night’s gap up. “Lower prior highs” were tested at 51.55, and back above 52.75 may be the nearest buy signal for the rally next targeting 56.15 — preferably resuming no later than Thursday morning.
Natural Gas Jan Contract (NG, ETF: (UNG, UNL))
The 3.44 fresh low overnight was attacked to within 1 penny Wednesday morning before bouncing back up into the prior two days’ range at 3.55. Tuesday’s confirmation to Monday’s breakout wasn’t optimal, so just the fresh low intraday might satisfy selling pressure. But until closing above 3.59, a fresh low close remains likely anyway.
Mid-day Update… Here it comes.
FOMC statement just moments away.
This morning’s noN-bias environment eventually dipped to 2260.25, still short of its potential to 2258.00. That’s more paralysis than pessimism ahead of the FOMC policy statement coming in 15 minutes.
Bouncing into and out of the noon hour triggered a late bias-up above 2266.75. The signal is still being overlapped, having produced only a 1 tick fresh high above the open’s 2267.75 peak.
Regardless of the statement’s particulars, reaction to it should be volatile, with a likelihood of probing fresh highs and also swinging into negative territory, both. Neither directly is likelier to precede the other, or not to be followed again by the other. And Yellen’s conference should start the process again.