Posts by Rod David
Mid-day Update… This way, and that way.
Morning rally not yet backing-off.
Absorbing the pre-open dip and its shallower post-open dip had marginalized sellers for the morning. Buyers exploited the conditions by triggering the 2124.25 bias-up signal. Its 2131.00 bias-up target was met, as was the 2135.50 next higher objective. The morning’s bias environment began lapsing at 2138.00.
Simultaneously overbought 1-minute and 3-minute RSIs at the morning’s high required a retest. That was just fulfilled, as the noon hour’s retracement to 2130.25 recovered the 2132.25 bias-down signal in time to trigger late no-bias. Room up to the 2139.75 bias-up signal was just fulfilled, too, taking RSIs overbought again.
Regardless of how strong the trending in one direction, we’re not considering it to be durable. Price action has been suggesting that this expiration can counter any trending. That would allow fulfilling the 2095.00 objective which yesterday afternoon’s market has already put on its to-do list.
Look ahead: Economic Calendar – for Fri Sep 16, 2016
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: It’s unusual to accompany expiration with econ reports, let alone high-profile and influential. But this quadruple expiration has two, and they’re staggered. The afternoon’s rig count influences Crude Oil, which influences the market at least momentarily — last week’s did not, but Crude prices did rise relatively sharply .
Quadruple Expiration
*Consumer Price Index
8:30 AM ET
*Consumer Sentiment
10:00 AM ET
*Baker-Hughes Rig Count
1:00 PM ET
Afternoon Bias
| THU afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 2147.00 | 2139.75 |
| …would target | 2153.00 | 2146.00 |
| Bias-down: under | 2139.25 | 2132.25 |
| …would target | 2133.00 | 2125.75 |
| Signal status: LATE NO-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.
Post-open Review… Tried, tried, again.
Pre-open and post-open dips absorbed.
The pre-open rally had tested the 2124.25 bias-up signal, and its reaction had tested the 2114.50 bias-down signal. That was pretty close to the open, but it didn’t equate to being a post-open test of the bias-down signal.
The open’s surge up to 2122.25 reacted down to 2114.75. Another bounce reacted down to 2114.50. Those were post-open, and pretty close to the bias-down signal. But they didn’t qualify as tests, either. And the second test’s reaction up started suggesting that sellers were marginalized.
Holding a test of the bias-down signal would have put into play an offsetting test of the 2124.25 bias-up signal. No need for that — bias-up triggered.
The 2128.00 high that printed by 10:15 has yet to be exceeded. Until it is, the bias-up can still be invalidated by exiting the bias environment back under the 2124.25 bias-up signal. Back under 2123.25 would start to signal momentum reversing down. Exiting the bias environment under its 2114.50 bias-down signal would still put into play its 2109.00 bias-down target.
Otherwise, the 2131.00 bias-up target is in-play. While sellers are marginalized for the morning, fulfilling the bias-up target would be an opportunity for today’s session to peak. Beware of sudden and substantial reversals during this expiration cycle.
Pre-market Tour (recording & summary)
The BOE reaction down from 2123.25 extended ultimately to 2117.25. Ultimately, for awhile. Its recovery to fresh highs tested the 2124.25 bias-up signal by 1 tick. And now ITS reaction down is probing lower lows down through the 2114.25 bias-down signal by more than 1 point. Gapping down and immediately extending to test 2110.50 would be a critical decision-point, as discussed during the Tour.
Details and other markets coverage are discussed in the pre-market Tour recording here.