Posts by Rod David
Pre-close View… Going through the motions.
Afternoon bounce is far from optimal.
Having triggered noN-bias at 1:30, the bias signals weren’t required to define the bias environment’s range. But they did. The 2133.75 bias-down signal held as support, and price gravitated up. Up, and away from this morning’s 2128.25 bias-down signal, whose test has become “unfinished business below.”
But that’s not necessarily bullish.
Recovering the 2137.50 prior high at 2:30 with the bias environment lapsing would have been bullish. But it was still being tested then. Price firmed further, and entering the final hour at 3:00 above the 2139.25 prior high would have been bullish. But it was only being attacked to within 1 point. Recovering the 2140.00 prior high through the 3:10-3:20 proxy window…
Anyway, you get the picture. A lot of buying pressure has been expended without gaining any traction for the effort. But the rubber band has been stretched. And yesterday’s high is holding as resistance.
None of which is a sell signal.
But breaking back under 2135.75 (being tested now) could trend back down aggressively into the close. The market may be vulnerable to extending higher, but there is no requirement other than to probe fresh lows.
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))
Monday’s bounce had retraced 61.8% of Friday’s steep drop through its 1.1265 sell signal, which Tuesday honored by not probing any higher, and by dipping back down toward Friday’s low. Not closing any lower would form a multi-session range which would be vulnerable to another breakout lower Wednesday.
Gold Dec Contract (GC, ETF: (GLD))
Monday’s gap up extended no higher intraday, but it wasn’t rejected Tuesday. At least, not yet. New lows targeting 1296.00-1297.00 remain in-play.
Silver Dec Contract (SI, ETF: (SLV))
Tuesday’s dip to 19.15 was recovered to attack the 19.35 bounce limit, but not recover it. Holding 19.35 Monday made the decline likely to resume, its retest of prior lows remaining intact.
30-year Treasury Dec Contract (US, ETF: (TLT))
Gaping up Tuesday and extending higher intraday to 166-23 was retraced back down to the 165-30 bounce limit, further suggesting the gap back down to 165-02 needs to be filled before a rally can begin.
Crude Oil Nov Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
[Coverage rolls forward to Nov which trades at a 75-80 cent premium to Oct] Could the pattern have bottomed? Last week’s failed Pivot Reversal tried, but resolved down. Now Tuesday’s Key Reversal is leaving no structural “unfinished business below” — gapping down within the range and recovering from a fresh low to close positive. Only measurable attractions remain outstanding, like 43.00 and 42.30. Closing above the Pivot Reversal’s 45.00 intraday high would be credible for reversing the trend back up.
Natural Gas Oct Contract (NG, ETF: (UNG, UNL))
Gapping up to fresh highs Tuesday and extending higher through the morning is essentially already fulfilling the 3.04 target. Higher targets will be in-play, especially upon confirming with a second consecutive higher close on Wednesday.
Mid-day Update… Holds not barred.
Attacking overnight lows has so far held as support.
The noon hour extended down and eventually touched 2131.00 in approaching the bias environment. The 2133.75 bias-down signal didn’t trigger — it was touched within 3 minutes of 1:20 to invoke the grace period through 1:30,k which was still touching it. So, there is no constraint to this afternoon’s range.
None of which removes the unfinished business below at 2128.25, which was put into play as this morning’s bias objective. But it can be left outstanding. And recovering 2136.50 (being tested now) could resume the overnight rally that had tried extending post-open.
Back under 2133.00 would resume the decline, and the 2128.25 attraction below. The afternoon is otherwise vulnerable to gravitating back up to the 2142.00 area, where resistance is largely chipped away, and vulnerable to being probed.
Look ahead: Economic Calendar – for Wed Sep 21, 2016
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: Wednesday’s BOJ statement is not at a fixed time, making it even more of a wild card. The afternoon’s FOMC statement is already high-profile and reliable for influencing price action. But Yellen’s quarterly Q&A has become an even greater volatility trigger.
*BOJ policy statement
timing undecided
MBA Mortgage Applications
7:00 AM ET
EIA Petroleum Status Report
10:30 AM ET
*FOMC Meeting Announcement
2:00 PM ET
FOMC Forecasts
2:00 PM ET
*Fed Chair Press Conference
2:30 PM ET
Afternoon Bias
| TUE afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 2148.25 | 2140.50 |
| …would target | 2154.00 | 2146.50 |
| Bias-down: under | 2141.25 | 2133.75 |
| …would target | 2135.50 | 2128.25 |
| Signal status: noN-BIAS, TESTED BIAS-DOWN SIGNAL | 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.