Posts by Rod David
Morning Bias
| FRI morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2711.00 | 2709.50 |
| …would target | 2719.00 | 2717.50 |
| Bias-down: under | 2696.25 | 2695.00 |
| …would target | 2688.25 | 2687.00 |
| Signal status: BIAS-DOWN, BIAS-DOWN TARGET MET | . | |
| BIAS VIDEOS… INTRO // EXAMPLE | ||
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.
Market Wrap (recording & summary)
REMINDER: I’m away from the screens Friday when the afternoon bias environment begins lapsing at 2:30 ET. There will be no Market Wrap or Saturday Review.
Thursday’s open was greeted by a relentless overnight slide from 2731.00 down to 2712.00. “Lower prior highs” at 2708.00-2709.00 had been pierced before the open, but needed an intraday test for a recovery to be reliable. The open held its test down to 2705.25 and reacted up to 2718.50, but a headline reaction triggered a collapse to fresh lows.
Not only to fresh lows, but to the next lower objective at 2688.00-2690.00. It was tested down to 2685.50 during the noon hour, which held. Its reaction only backed-and-filled up to 2700.00. The last half-hour broke higher to touch the 2705.25 pre-open low as resistance.
Closing back above 2708.00-2709.00 would have signaled that sellers were absorbed, and that momentum had reversed up. By proxy, gapping up Friday above Thursday’s open could be just as bullish and durable. The decline could simply resume, since it hasn’t yet been rejected. And having bounced into the close, gapping down to and/or through Thursday afternoon’s 2689.00 low could form a session-long decline.
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))
Already having missed the end of its window to rally by Tuesday afternoon, Wednesday trended down further and so did the overnight. Thursday’s open gapped down to the 61.8% retracement of the 2-week old low close and the next day’s gap up (view Market Wrap for details) at 1.1366. It held, and now closing above 1.1400 would reverse momentum back up.
Gold Feb Contract (GC, ETF: (GLD))
Overnight weakness down to 1306.50 filled another gap that helped to neutralize its attraction below, while remaining within the orbit of last Thursday’s 1328.30 gap up that still needs to be retested from below, probably up to 1333.00. Closing back up above 1317.00 would signal the recovery underway again.
Silver Mar Contract (SI, ETF: (SLV))
Lower lows overnight down to 15.63 need to define the pullback’s low to keep alive potential for retracing the current leg back up to 16.16 without needing first to form a bottoming pattern. Closing back above 15.80 would signal the recovery underway.
30-year Treasury Mar Contract (US, ETF: (TLT))
Already rallying to a fresh high again overnight further chipped away at the 146-04 resistance to allow retesting the 147-00 prior high, if not also to resume the rally. Thursday’s gap up ranged sideways around Wednesday’s 146-09 high, needing a higher close to signal momentum remains intact.
Crude Oil Mar Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Flat-to-lower ranging overnight trended down sharply Thursday from Wednesday’s 54.00 close to probe the 52.15 sell signal down to 51.80. A gap fill at 52.00 requires a second consecutive lower close to confirm momentum reversing down, and meanwhile closing back above 53.20 would reject Thursday’s sell signal and reverse the trend back up.
Natural Gas Mar Contract (NG, ETF: (UNG, UNL))
Thursday’s EIA report was being greeted from a position of weakness before probing even lower overnight. Thursday extended down to fresh lows attacking 2.55, maintaining a pattern that is unable to trigger a buy signal.
Mid-day Update… Proving ground.
Snapped stretch trying to snap back.
“Lower prior highs” at 2708.00-2709.00 defined the open, while being probed down to 2705.25. 
And it could have defined a bottom. But its reaction up to 2718.50 came too quickly to attract more reinforcements than inhibit them. And a China trade headline transformed an otherwise healthy pullback into resuming the decline.
The next lower objective at 2688.00-2690.00 was tested down to 2687.25 as the bias environment lapsed. The noon hour’s lower lows at 2685.50 were recovered enough and in time to avoid triggering the afternoon’s 2688.00 bias-down signal. Its reactions held tests of the 2695.50 bias-up signal. This is a no-bias environment.
No-bias trending just touched 2700.00, requiring that 2695.50 be retraced. No-bias trending has room up to 2705.00 without even threatening to reverse momentum up. Meanwhile, back under 2693.50 could resume the decline, or at least probe fresh session lows.
Look ahead: Economic Calendar – for Fri Feb 8, 2019
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: An unusually slow week for econ reports, as annual earnings grabbed most of the attention, ends with none for the entire morning on Friday.
Baker-Hughes Rig Count
1:00 PM ET