Posts by Rod David
Look ahead: Economic Calendar – for Thu Dec 15, 2016
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: Five econ reports are released simultaneously before Thursday’s open. Two of them have a reliable track record for influencing price action. At least three are high-profile anyway. That should enhance volatility from any post-open reports.
*Consumer Price Index
8:30 AM ET
Jobless Claims
8:30 AM ET
*Philadelphia Fed Business Outlook Survey
8:30 AM ET
Empire State Mfg Survey
8:30 AM ET
Current Account
8:30 AM ET
Bloomberg Consumer Comfort Index
9:45 AM ET
Housing Market Index
10:00 AM ET
EIA Natural Gas Report
10:30 AM ET
Treasury International Capital
4:00 PM ET
Fed Balance Sheet
4:30 PM ET
Money Supply
4:30 PM ET
Afternoon Bias
| WED afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 2271.75 | 2266.75 |
| …would target | 2276.50 | 2271.75 |
| Bias-down: under | 2264.00 | 2259.25 |
| …would target | 2257.75 | 2252.75 |
| Signal status:LATE BIAS-UP | 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.
Post-open Review… Shades of pessimism ahead of FOMC.
Overnight dip extends, briefly.
Breaking under the overnight range’s lower-end probed under yesterday’s late 2265.50 lows down to 2262.75. Its post-open reaction touched 2267.75 before reversing back down, targeting a probe under the pre-open low. It was probed by 1 point down to 2261.75.
The reversal’s timing touched the 2264.00 bias-down signal in time to invoke the grace period. And after another retest of the low, 2264.00 was tested again. Tested again, but still being tested when the grace period lapsed at 10:30.
This is a noN-bias environment. Not a bias-down targeting 2258.00. Not a no-bias targeting a test of the 2270.75 bias-up signal. it is noN-bias, without any bias requirement this morning.
Fresh lows would still be likely to test 2258.00. Extending higher would still be likely to test 2270.75. Any resolution at all is hampered by strong-handed sponsorship generally sidelined just before a high-profile event like this afternoon’s FOMC.
Pre-market Tour (recording & summary)
The overnight range’s upper-end was touched at 2268.75, and then reversed to fresh lows at 2263.50. All of which may be only increased volatility, but potential for constructive pessimism ahead of this afternoon’s events could encourage an attempt to break lower.
Details and other markets coverage are discussed in the pre-market Tour recording here.
The First Trade… Walking on eggshells.
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…
Tuesday’s gap up to Monday’s 2259.00 high was not rejected, all but dictating the balance of the session’s direction. Which was up. A lot. The 2270.00 objective to retesting Sunday night’s high was exceeded, only once, and by 3 points going into the afternoon bias environment. It reacted down to 2265.50 coming out of the afternoon bias environment, and a bounce back up to 2270.00 held its retest as price ranged sideways through the last 60-90 minutes.
Overnight action’s new info…
A narrower version of the sideways ranging of yesterday’s last timing window has persisted overnight. Lows have touched 2265.00, while the range’s upper-end has been defined by 2268.25 — which is being retested now.
If, then…
Overbought 1-minute and 3-minute RSIs during the formation of yesterday afternoon’s 2273.00 high suggests it will be retested. Only 1-minute RSI was actually overbought during its highest bar, but closing within proximity of it has reinforced its attraction. Trending ahead of an FOMC statement would be unusual, so the overnight paralysis represents some degree of normality. But rallying relentlessly for seven days ahead of the event makes today far from normal, today already being the most opportunistic day of trade setups. Currently, no “unfinished business above” remains outstanding, and no defensive posturing ahead of this afternoon’s events suggests more upside into and/or out of them. Some negative reaction should be part of the mix at some point, and probably also some fresh high.
First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 under 2266.75 would be unlikely to trigger this morning’s 2270.75 bias-up signal at 10:15. Exiting the open above 2272.25 would be likely to trigger bias-up.