Posts by Rod David
Post-market Wrap (recording & summary)
This weekend’s Saturday Review has been cancelled, so Friday’s post-market Wrap was extended to discuss the bigger picture and stock requests. Its recording is not the usual Saturday format, but the usual weekday format..
The week ended with one piece of “unfinished business above” at 2175.50. That’s 3 points above Thursday’s high. Being in the context of unfinished business above, Friday’s slide is assumed to be a temporary detour. But that’s the assumption anyway, since shallow trending or ranging on Fridays can be the week’s least predictive price action.
That’s not to say nothing relevant was accomplished Friday. Its low filled the gap back down to Wednesday’s close, and held it. Already trending up Sunday night to some degree, and gapping up Monday, is somewhat likelier at this stage — assuming no dramatic weekend developments that would require being absorbed.
Otherwise, any lower intraday Friday would have targeted at least 2149.00. That could still hold if tested Sunday night, but the delay makes any selling likelier to test “lower prior highs” down to 2143.50. And there’s room below it to 2138.00 before suggesting that 2175.50 won’t be tested soon.
The following stock requests were reviewed in this order:
GDXJ, ERII, POT, JJG, AERO, KSHB, CMG
Pre-close View… Down for the count.
Not reversing the session’s slide.
The afternoon’s 2156.00 low was recovered back up to the 2161.25 bias-down signal. Its resistance didn’t have to prevent extending the recovery. But the timing windows didn’t help.
Having trended down into the afternoon, exiting the bias environment back above a prior high could have triggered a short-squeeze. But the prior high wasn’t touched until after entering the final hour, still under 2161.25.
The recovery is firming anyway, probing the open’s 2161.75 low and attacking the noon hour’s 2163.75 prior high. But the timing has made this recovery suspicious, so reversing down remains a possibility.
SPECIAL PROGRAMMING NOTE: There is no Saturday Review this weekend. Today’s post-close Market Wrap will be expanded to include a Bigger Picture discussion and stock requests.
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))
The portion of Thursday’s break back under 1.1265 was retraced immediately Friday, and held through the morning. The afternoon ranged around it, resisted by the gap back to Thursday’s 1.1280 open, neutralizing its attraction without reversing momentum up.
Gold Dec Contract (GC, ETF: (GLD))
Friday’s dip was still overlapping 1341.50 but not necessarily closing under it. It isn’t optimal for rejecting the week’s rally, but it does prevent confirming Thursday’s close above resistance, keeping the door open to another downleg without delay.
Silver Dec Contract (SI, ETF: (SLV))
Closing back at or under 19.85 Friday does prevent the recent multi-day surge from being confirmed. Closing Friday back under 19.75 would have been optimal. Alternatively, almost any initial weakness Monday — if not already sliding Sunday night — would be credible for retracing the week’s rally.
30-year Treasury Dec Contract (US, ETF: (TLT))
Extending higher Friday would have confirmed Thursday’s breakout from the ongoing bottoming pattern that we’ve been monitoring. Not yet confirming it does not equate to invalidating it. But the breakout’s rally should become obvious no later than Tuesday if valid.
Crude Oil Nov Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Friday’s gap down extended to fill the gap back to Tuesday’s ~44.25 close. The test should hold, although it can temporarily probe a little deeper before recovering Monday. Regardless, Wednesday’s confirmed breakout already requires there to be at least an eventual fresh high close.
Natural Gas Oct Contract (NG, ETF: (UNG, UNL))
Thursday’s reaction down on its EIA report extended lower Friday, holding a test of the “lower prior highs” at 2.94. Momentum has not reversed down, but the lower prior highs test must hold through the next close, if not already start recovering to resume the rally.
Mid-day Update… Still down. Still out.
Bias environment lows have given way.
Being at the bottom of this morning’s range was a given as the bias environment was entered. Bouncing toward or to its upper-end was not a given, although there was room. Plenty of room, but zero assurance. And the bias environment only ranged narrowly at its lows.
Now the lows have given way. Not that sellers are much more forceful. Dipping to 2159.75 just managed to touch this afternoon’s 2161.25 bias-down signal within 3 minutes of 1:20 to invoke the grace period. And it was still being overlapped at 1:30 to avoid triggering.
This is a noN-bias environment. Not bias-down, not no-bias, but noN-bias. No target or objective is in-play.
Back above 2163.50 would start to signal a rally underway anyway. But where there is no likelihood for trending down, there is potential to gravitate down.
Look ahead: Economic Calendar – for Mon Sep 26, 2016
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: Monday’s Fed speaker is more influential to price action for the timing of his remarks, coming when the market is trying to establish post-open action. The two econ reports are otherwise not reliably influential to price action, other than more housing sector data having a chance to deviate from the prior week’s reports .
*Neel Kashkari Speaks
9:30 AM ET
New Home Sales
10:00 AM ET
Dallas Fed Mfg Survey
10:30 AM ET
3-Month Bill Auction
11:30 AM ET
6-Month Bill Auction
11:30 AM ET
2-Yr Note Auction
1:00 PM ET