Posts by Rod David
Pre-market Tour (recording & summary)
The drop from the 2174.50 overnight high has been retraced by 61.8% to test 2169.00. That’s also the preliminary signal whose recovery through 9:45 would suggest bias-up will trigger at 10:15. Nothing prevents the bullish scenario from rallying immediately post-open to extend the pre-open bounce. Rejecting the pre-open bounce need not develop so quickly, but back under 2163.50 would start to suggest at least a retest of Friday’s “lower prior highs.”
Details and other markets coverage are discussed in the pre-market Tour recording here.
The First Trade…Bubbling up.
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 8-10 point gap down fell another 8 points through the morning, and still managed only to attack Thursday’s 2147.75 lows. That relative shallowness is a product of how wide ranging was Thursday’s choppy session. The balance of Friday’s session fluctuated back up to the 2156.50-2162.00 open, within the morning’s range, which reflected the narrower participation of the Veteran’s Day holiday. No unfinished business was left outstanding.
Overnight action’s new info…
Friday recovery back up to its morning highs resumed immediately. And the wide-ranging choppiness of Thursday resumed, too. Sunday night’s open gapped up 5 points and extended relentlessly to attack 2174.00. Reacting down to attack 2165.50 was recovered to 2174.00, which held several tests as resistance through Europe’s opens. Gradually slipping from there suddenly broke sharply lower, briefly probing negative territory and Friday’s “lower prior highs” down to 2158.00. A recovery attempt is now testing 2165.00.
If, then…
Attraction to higher objective remains stronger than any signs that the slowing upside momentum is rolling over. Gapping up and extending higher Sunday night suggests that attraction remains influential, but its reaction reminds us to be watchful for more backing-and-filling first. That downside become likelier if today’s open is back under Friday’s 2161.00-2162.00 highs, which would isolate Sunday night’s rally to the overnight. Otherwise, extending higher to retest 2180.00 intraday would still be vulnerable to reacting down, instead of fulfilling its potential to 2185.00-2186.00.
First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 above 2169.00 would be likely to trigger the 2165.50 bias-up signal at 10:15. Exiting the open under 2158.75 would be unlikely to trigger bias-up.
Tonight’s Globex open
Three earthquakes this weekend since Friday’s close — Italy, New Zealand and Argentina. They’re not a harbinger of things to come this week. That would be a coincidence. But its poetic balance reminds us that the market still has much to process, which is opposite to what’s implied by Friday’s narrow inside day.
Monitor trading as the new week begins in the chaRTroom, by following the below link. I’ll be checking in overnight to identify any setups and patterns forming…
Saturday Review’s recording (for 11/12/16) …
Interest rates have become very attractive compared to stocks, which rallied sharply last week. Rotation may have begun already, but only on the margins, so stocks may have more upside. But it’s not often too long after Gold tumbles that stocks tend to follow.
Meanwhile, Tuesday night’s plunge left a mark. But it didn’t change the structure that greeted last week’s rally. Saturday Review describes that impact, and also addresses the market’s likely paths, their levels, and characteristics to expect.
The following stock requests were reviewed in this order:
BAC, AAPL, FB, GOOGL, NFLX
11/12/2016 09:31:32 David B: Good Morning
11/12/2016 09:32:08 Mark Glezer: gm
11/12/2016 09:32:11 charlie: hi
11/12/2016 09:51:20 Mark Glezer: historically limit downs retested within a month or so?
11/12/2016 09:54:48 sm: While there is “no particular timeframe” on the retest of last weeks low, is there nevertheless a persistent drag on the market’s ability to rally from here – to new highs and beyond? At what point would the market escape the ‘magnetic pull’ of the need to retest that low?
11/12/2016 09:56:05 Mark Glezer: major indexes showed a bearish relationship lately, is that still the case?
11/12/2016 10:09:07 sm: Since the NQs generally represent speculative interest (relative to the S&Ps and DOW), how does this underperformance square with your earlier comment that the context of the rally right now (which has the needed retest of last week’s low still outstanding) will be characteried by speculative fervor?
11/12/2016 10:10:14 Mark Glezer: fresh high in ES – meaning 86-87 would not suffice to expect a durable reversal?
11/12/2016 10:15:34 Mark Glezer: BAC – off to the races?
11/12/2016 10:15:54 sm: Reaching 87 – 92 WOULD change the structure – would it not?
11/12/2016 10:16:15 sm: Isn’t that a new high?
11/12/2016 10:16:52 sm: I interpreted your meaning of ‘structure’ as lower lows and lower highs
11/12/2016 10:17:57 sm: I guess that’s what I’m saying – that if a new high is seen, it means that we have a new structure of higher highs (and higher lows) underway.
11/12/2016 10:22:25 David B: has 2120 and 2160 cash been a very influence level on a break below. it seems when we godown they seem to bounce back above
11/12/2016 10:22:39 David B: godown=gone down
11/12/2016 10:29:15 Bill G: NFLX still above lower highs
11/12/2016 10:30:19 Mark Glezer: thx much
11/12/2016 10:30:28 charlie: tks
11/12/2016 10:31:06 sm: thx
Saturday Review Link
Certainly among the most interesting weeks I’ve ever experienced. But still only a contender. And most of the others were within the past year or two. In the excitement, prices change so dramatically that normal relationships don’t keep pace. We’ll look at some of those opportunities during this weekend’s Saturday Review.
Be sure to join us by 9:30am ET at the link below. After discussing the bigger picture and gaming out strategies for playing next week’s likelier opening setups, we’ll do instant analysis of any stock charts that you request… See you there!