Posts by Rod David
Look ahead: Economic Calendar – for Thu Nov 3, 2016
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: None of Thursday’s reports actually has a reliable track record for influencing price action. But there are a lot of reports, so any reaction to one pre-open is likely to be duplicated by others.
Challenger Job-Cut Report
7:30 AM ET
Jobless Claims
8:30 AM ET
Productivity and Costs
8:30 AM ET
Gallup Good Jobs Rate
8:30 AM ET
Bloomberg Consumer Comfort Index
9:45 AM ET
PMI Services Index
9:45 AM ET
Factory Orders
10:00 AM ET
ISM Non-Mfg Index
10:00 AM ET
EIA Natural Gas Report
10:30 AM 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 | 2109.75 | 2103.75 |
| …would target | 2115.50 | 2109.50 |
| Bias-down: under | 2199.50 | 2093.50 |
| …would target | 2094.00 | 2088.00 |
| Signal status: BIAS-DOWN | 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… Half-step forward, three-quarters step back.
Opening dip recovered in time, attacked too late.
The open’s dip to 2099.50 was also a test of the 2100.50 bias-down signal. Its reaction probed above overnight highs to 2106.50. Triggering no-bias after holding the bias-down signal’s test through 10:15 put into play an offsetting test of the 2109.50 bias-up signal.
A pullback into 10:30’s EIA announcement became a plunge as the announcement triggered Crude Oil dropping further. The 10:30 bar probed under the bias-down signal, and under the opening low. But it also overlapped the bias-down signal, and didn’t qualify for invalidating no-bias.
So, an offsetting test of the bias-up signal remains the likely resolution after the current dip is done. And it could be done after testing only 2093.50, not necessarily testing yesterday’s 2091.00 low required by its oversold RSIs.
Back above 2101.25 would signal the late plunge had ended already. A very aggressive move to fresh highs would be likely. Otherwise, a fresh low under 2097.00 would target 2093.50 and potentially also probe under 2091.00.
Pre-market Tour (recording & summary)
The overnight recovery back up to 2104.00 has held, at least for a reaction down attacking 2098.00. Fitting. An opening test of 2098.00 would be predictive of the 2100.50 bias-down signal’s likelihood for triggering. But the bounce has reacted up to 2103.00. And recovering another couple of points through the open would be unlikely to trigger bias-down. Either way, even without the preliminary indication, 10 points either way is possible before this afternoon’s FOMC statement.
Details and other markets coverage are discussed in the pre-market Tour recording here.
The First Trade… More, or less.
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…
Rejecting the overnight probe above 2124.25-2125.00 was likely to launch a downleg back to the prior low. But Tuesday’s plunge from its 2125.00 open was much more productive than that. The morning’s 2111.26 bias-down target was fulfilled, along with the prior low’s retest objective at 2105.00, and the long outstanding 2095.00 objective. The latter was probed down to support at 2091.00 where a bounce to some degree was likely — it eventually attacked 2109.00. A hold-long was indicated at the close, with a pullback limit of 2104.00. Oversold RSIs were left outstanding at the low, along with the next lower objective at 2182.00.
Overnight action’s new info…
The rally never touched 2109.00, let alone exceeded it. The 2104.00 pullback limit was tested almost immediately. The drop extended relentlessly until touching 2095.00 — and this morning’s 2094.75 bias-down signal. Choppy ranging gradually firmed, and now has surged, testing 2104.00 as resistance
If, then…
Not dipping back under 2104.00 would have enabled Tuesday’s hold-long.to reach 2111.25, then the 2115.00 and 2121.25-2122.00 areas. They could still be met, if today’s open were to reject the overnight probe under 2104.00 as yesterday’s open rejected its overnight probe above 2125.00. Otherwise, the overnight low’s retest down to oversold RSIs at yesterday’s 2091.00 low would be likely. So would an extension down to 2082.00, with room for noise down to 2077.50. Trending or any aggressive move would become more difficult as the afternoon’s FOMC statement nears. Anxiousness ahead of its likely hawkish statement, or in reaction, could be followed by a relief rally for having the event become history..
First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 above 2104.00 would be unlikely to trigger the 2100.50 bias-down signal at 10:15. Exiting the open under 2098.00 would be likely to trigger bias-down. Exiting the open above 2111.25 would be likely to trigger the 2109.50 bias-up signal.