Posts by Rod David
Mid-day Update… Digging a deeper hole.
Retesting this morning’s low.
The gap down at 2131.00 and slide to 2123.25 was retraced entirely during the morning’s bias environment. The 2132.75 bias-down signal was attacked to within 1 tick where its resistance produced a reaction back down to 2125.50.
The noon hour bounced again, to within 3 ticks of 2132.75. Resistance pushed back again. This afternoon’s 2124.25 bias-down signal didn’t trigger, but it is being tested anyway down to 2123.00.
Being a no-bias environment, its 2124.25 bias-down signal should define the range’s lower-end. And, so far, it is. No bar probing a fresh low under 2124.25 isn’t also overlapping 2124.25. And its test has reacted up to 2127.25.
The bias environment will come within view of lapsing at 2:15-2:20. Breaking under 2124.25 would then be entirely credible for resuming the drop. The leg underway Wednesday afternoon would be confirmed under 2121.25, still targeting 2095.00. The alternative to breaking lower today isn’t necessarily to rally, but at least firming back toward today’s high.
Look ahead: Economic Calendar – for Mon Sep 19, 2016
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: The week gets off to a slow start before items like FOMC and BOJ policy statements grab our attention.
Housing Market Index
10:00 AM ET
3-Month Bill Auction
11:30 AM ET
6-Month Bill Auction
11:30 AM ET
Afternoon Bias
| FRI afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 2140.75 | 2133.00 |
| …would target | 2146.50 | 2139.00 |
| Bias-down: under | 2131.75 | 2124.25 |
| …would target | 2125.75 | 2118.00 |
| Signal status: NO-BIAS | 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… Setting the tone.
Overnight drop extended through the open.
Testing the 2127.00 bias-down target overnight had produced a bounce that recovered the last downleg from 2136.00. Its test and retest greeted the open at 2131.00, on the way down to retest 2127.00. Breaking under 2127.00 through 10:15 has renewed the bias-down signal, next targeting 2121.25.
Meanwhile, the open gapped down under 2134.00 to help reject yesterday’s close above it. Closing under 2134.00 would help confirm this remains a distributive environment, likely to resolve bearishly.
Extending down to 2123.25 while 1-minute RSI diverged positively is producing a bounce. It’s now testing 2132.50, and could still test 2134.00. But back under 2128.50 would signal the drop had resumed.
This being expiration — quadruple witch, no less — sudden reversals are more possible, if not likelier. Exiting the bias environment back above its 2132.75 bias-down signal (being attacked now to within 1 tick) would suggest a bottom for the day is in. The afternoon otherwise remains likely to trend down.
Pre-market Tour (recording & summary)
The overnight drop had tested this morning’s 2127.00 bias-down target. Now its recovery is attacking the last downleg’s origin to within 1 tick at 2136.00. Twice. It could be probed a little higher yet, up to 2137.50, and remain very vulnerable to reversing back down to and through the overnight lows. But not triggering the 2132.75 bias-down signal would allow the bounce to retest yesterday’s 2144.50 high before ranging flat-to-lower this afternoon.
Details and other markets coverage are discussed in the pre-market Tour recording here.