Posts by Rod David
Morning Bias
| FRI morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2137.50 | 2131.00 |
| …would target | 2142.50 | 2136.00 |
| Bias-down: under | 2128.00 | 2121.50 |
| …would target | 2121.50 | 2115.00 |
| Signal status: BIAS-UP, BIAS-UP TARGET EXCEEDED | 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)
Testing higher prior lows at 2131.00-2132.00 ultimately reacted down 6-1/2 points to 2123.75 at Thursday’s cash session close. Holding higher prior lows prevents gaining traction. That’s a mixed signal with the afternoon’s timing traction indicator, of exiting the bias environment and entering the final hour, That had indicated the rally did gain traction. Both signals can be fulfilled by trending up through the morning after gapping down, or by gapping up above the afternoon’s 2132.25 recovering high.
The latter setup would delay fulfilling a third signal, which requires retesting oversold RSIs at Thursday’s 2107.75 low. Of course, that “unfinished business below” could be delayed, probably through the weekend after gapping up on a Friday. But that’s not optimal. Anyway, its test is likely to visit 2105.00 if not also 2095.00. A bigger bounce first could reach 2149.00.
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… Correction done?
Holding a test of “higher prior lows.”
This afternoon’s 2122.00 bias-up signal triggered late. But it’s 2127.75 bias-up target was soon tested on the way up to 2130.00. A symmetrical triangle formed while the bias environment was lapsing, and it broke higher to 2132.00.
Symmetrical triangles tend often to break falsely in one direction and reverse more substantially in the opposite direction. Overbought RSIs at the high allowed price to trend down. But so far, only 2127.00 is being tested. That’s not yet a “more substantial” reversal.
Back above 2131.00 would suggest trending up overnight. Today’s recovery did gain traction for its efforts by exiting the bias environment above the noon hour’s high, and then entering the final hour higher. Its reward is to trend up after tomorrow’s open, but that could be fulfilled regardless of trending back down into the close.
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))
Flat-to-higher narrow ranging Thursday didn’t contradict Tuesday’s confirmed breakout, which is required to produce at least an eventual third lower close.
Gold Dec Contract (GC, ETF: (GLD))
Narrow ranging Thursday did not fulfill the deeper dip already indicated by having started the week with “ineffectual optimism.” Back above 1266.00 would be credible for extending higher intraday, but there is otherwise a pullback underway with potential down to 1236.00.
Silver Dec Contract (SI, ETF: (SLV))
Thursday’s narrow ranging still doesn’t offset the “ineffectual optimism” that had prevented the week’s initial strength from extending. Recovering 17.80 Friday would suggest a rally underway into the weekend, but there is otherwise a deeper pullback underway.
30-year Treasury Dec Contract (US, ETF: (TLT))
Holding 163-27 Wednesday and closing above 164-08 Thursday suggests the decline’s momentum has lapsed. Closing above 165-02 (being tested in the afternoon) would confirm, and back above 165-18 would reverse the trend back up.
Crude Oil Nov Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Extending the pullback to 49.35 Thursday morning was recovered suddenly after the EIA report to test 50.60, still short of rejecting Wednesday’s break under the 50.80 pullback limit. Almost any initial weakness Friday would be likely to extend to fresh reaction lows.
Natural Gas Nov Contract (NG, ETF: (UNG, UNL))
Dipping at Thursday’s open used all but the last 2 cents of room for a pullback to 3.14 before the EIA report. Its reaction surged to test 3.36, now allowing room for a pullback to 3.31 to keep alive the rally’s momentum next targeting 3.60.
Mid-day Update… Refueling.
Corrective bounce, or budding recovery?
The open’s test of 2108.00 was recovered through the morning’s bias environment, back to the 2118.00 open. It was too late for that to qualify as recovering the dip to 2112.00 to isolate sellers. But it was enough for entering the noon hour above 2121.75 to suggest as much.
The noon hour’s entry was still testing 2118.00, so the setup remained alive, but needing more validation. Attacking the 2125.25 “higher prior lows” to within 1 tick during the noon hour does not qualify. But now triggering the afternoon’s late bias-up signal above 2122.00 at 1:30 can exit the bias environment above 2125.25 to point momentum up.
Late bias-up actually puts into play 2127.75. That’s still representative of resistance at “higher prior lows,” and potentially the peak of a corrective bounce.
So, there is an attraction above in-play. It has potential to produce something bigger, but not durable since there is “unfinished business below.” And back under 2120.50 would signal momentum reversing down. Fresh lows targeting 2105.00 and 2095.00 would be in-play.