Posts by Rod David
The First Trade… Buckle in.
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…
.Wednesday performed similarly to a session-long rally reaching 2142.50. Each timing window probed the prior timing window’s high, with the only exception being the last window, which fell to 2137.50 through the futures close. WedEX didn’t trigger as session highs only fluctuated around prior highs (i.e. 2138.00-2139.75). “Unfinished business above” was left outstanding at the afternoon’s 2145.50 bias-up target.
Overnight action’s new info…
The Globex open’s blip-down to 2136.25 was reversed immediately to begin recovering all but 2 ticks of Wednesday afternoon’s pullback from 2142.50. A spike up to 2144.50 probed above Wednesday’s high but never extended before being retraced entirely.– and then some, back down to 2138.00 through Europe’s opens. Price has since firmed back up to test 2141.00.
If, then…
Gapping up and/or probing high enough Thursday could serve by proxy to trigger bullish WedEX, depending on its resolution and other minor elements. Maintaining a gap up above Wednesday’s 2142.50 high could trigger an active bullish WedEX. Rejecting an early probe above 2142.50 could trigger a passive bearish WedEX. Gapping down would have to be relatively substantial to be relevant. Regardless of WedEX, there’s still potential for at least an intraday probe higher to fulfill the 2145.50 objective. The ECB policy statement and Mario Draghi press conference are just minutes away…
First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 above 2143.00 would be likely to trigger the 2141.50 bias-up signal at 10:15. Exiting the open under 2138.75 would be unlikely to trigger bias-up.
Morning Bias
| THU morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2147.50 | 2141.50 |
| …would target | 2152.25 | 2146.25 |
| Bias-down: under | 2139.00 | 2133.00 |
| …would target | 2133.75 | 2127.75 |
| Signal status: NO-BIAS, TESTED BIAS-DOWN SIGNAL | 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)
Well, we made it through the Black Monday anniversary from 1987, without any hint of a crash, or any jokes about it. In fact, the session behaved as if a session-long rally, each timing window probing the prior timing window’s high, with only one exception. And that was the last window, perhaps inhibited either by pre-post-close earnings jitters (AXP, EBAY) or the evening’s “Presidential” debate.
“Unfinished business above” was left outstanding at the afternoon’s 2145.50 bias-up target. Testing it Wednesday would have been vulnerable to extending higher. Delaying its test until Thursday now makes it likely to extend higher. The next higher objective would be 2150.00.
WedEX didn’t exactly trigger. Fluctuating throughout the afternoon around prior highs (i.e. 2138.00-2139.75) persisted through the close. Gapping up Thursday could serve by proxy, if gapping up enough and maintained. Gapping down would have to be relatively substantial to be predictive. I suspect the resolution will be up, based on the continued pessimism or restrained optimism, either one being somewhat bullish from a contrarian perspective.
REMINDER: THE CHARTROOM LINK BELOW IS NEW, BUT THAT SHOULDN’T AFFECT YOUR LOGIN. PLEASE CONTACT ME IMMEDIATELY IF YOU EXPERIENCE ANY DIFFICULTY.
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… Taking it easy into the danger zone.
Gradual improvement maintaining higher highs.
SPECIAL NOTE:
THE CHARTROOM LOGIN WILL CHANGE THIS EVENING. SUBSCRIBERS THAT FOLLOW THE BLOG LINK WON’T NOTICE ANY DIFFERENCE. LET ME KNOW IF YOU ENCOUNTER ANY DIFFICULTY.
All but one timing window today has probed above the prior timing window’s high. The last 60-90 minutes is the one exception. And there’s still 30 minutes remaining.
The afternoon’s bias-up signal triggered, putting into play its 2145.50 bias-up target. Fresh highs during the bias environment ensured it would become “unfinished business above” if not met. It was attacked to within 3 points.
A pullback to 2139.00 is trying to recover, or trying not to extend any deeper. Either way, it’s too late for a downleg to be predictive. And the late hesitation is just enough restrained optimism — if not actually pessimism as during the past couple of days — to keep the contrarian perspective bullish.
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))
Tuesday’s retest of Sunday night’s low had stopped optimistically short. Fresh lows overnight fulfilled that minimum objective, while holding 1.0994 to avoid requiring lower lows. But 1.1011 must be recovered to begin signaling a bottom may be forming.
Gold Dec Contract (GC, ETF: (GLD))
Although Tuesday’s gap up and follow-through had stopped short of the 1266.00 buy signal, Wednesday’s open gapped up above it to attack 1274.50. The bounce could extend to 1283.50, but reversing down first to attack the lows would form a more durable bottom.
Silver Dec Contract (SI, ETF: (SLV))
Gapping up Wednesday only spent the session fluctuating narrowly around prior highs, and under the 17.80 buy signal.
30-year Treasury Dec Contract (US, ETF: (TLT))
Two days spent testing the 164-08 buy signal as resistance without recovering it did try breaking higher Wednesday. Closing higher Thursday would confirm a bigger bounce underway targeting 166-19.
Crude Oil Nov Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Potential for retesting the rally’s 51.50 target was fulfilled Wednesday when reaction to the EIA report triggered a surge to attack 52.00. The retest was likely to hold, and did spend much of the day hovering just above 51.50, but not rejecting it. Closing higher Thursday would confirm 54.60 is in-play
Natural Gas Nov Contract (NG, ETF: (UNG, UNL))
Despite Tuesday’s gap up and test of 3.29 resistance not closing under 3.26 — only at it — an overnight slide tested 3.14. Holding it as support maintains the potential for retesting the highs, if not also for resuming the rally.