Posts by Rod David
Morning Bias
| TUE morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2646.25 | 2645.00 |
| …would target | 2654.25 | 2653.00 |
| Bias-down: under | 2634.25 | 2633.00 |
| …would target | 2628.50 | 2627.25 |
| Signal status: NO-BIAS INVALIDATED, TESTED BIAS-UP SIGNAL | . | |
| BIAS VIDEOS… INTRO // EXAMPLE | ||
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.
Market Wrap (recording & summary)
Friday and Monday are almost mirror images of each other. Each gapped either up or down, respectively. Each extended intraday in their gaps’ direction. Each returned to their opening prints, not gaining any traction for their intraday efforts. And each tested an attraction at its intraday extreme.
Monday’s 2638.50 open was overlapped at the close, after extending intraday down to 2622.25 and recovering temporarily up to 2642.75. Monday’s lows held the afternoon’s 2622.75 bias-down signal and the ongoing relevant 2625.00.
The island-like patterns formed Friday and Monday aren’t actually Islands, because they developed within prior recent price action. Neither is a reversal pattern, and neither requires being retested if it produces a reversal. So, Friday’s range doesn’t require being retested, yet…
Almost any overnight strength is likely to recover back into Friday’s range. That would mean back above 2656.00, and closing above 2666.00 would reinstate upside momentum. Similarly, almost any weakness — overnight or through Tuesday’s open — would be likely to resume the decline through 2625.00. And under 2625.00 lies an air pocket likely targeting 2605.00. Perhaps even deeper to compensate for the delay in breaking under 2625.00
Details and other markets coverage are discussed in the post-market Wrap recording here.
Monitor overnight Globex trading in the chaRTroom here.
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 Mar Contract (EC, ETF: (FXE, UUP))
Flat-to-higher ranging overnight extended Monday morning to fulfill the likely 1.1485 objective. Closing above it would signal a new upleg underway. That’s likely since Monday’s extension qualifies as a second consecutive higher close above the downtrending resistance pattern that Friday had broken already.
Gold Feb Contract (GC, ETF: (GLD))
Fresh highs overnight up to 1303.70 had been retraced pre-open but largely recovered Monday. The second consecutive higher close confirms the next higher target at 1319.50 remains in-play.
Silver Mar Contract (SI, ETF: (SLV))
Probing higher overnight to 15.83 had been retraced pre-open but largely recovered intraday, at least to the 15.75 prior high’s resistance that must be recovered to resume the preceding rally. Monday’s second consecutive higher close suggests the rally is resuming anyway.
30-year Treasury Mar Contract (US, ETF: (TLT))
Monday’s open immediately surged enough to probe 145-08 and 145-12 whose recovery through the close would suggest the correction of Thursday’s breakout had ended and momentum was reversing up.
Crude Oil Mar Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Gapping down Monday to 52.75 had needed to hold to maintain near-term upside potential, but extended to attack the 51.25 lower-end of the current range under 51.65. Breaking under the range would make further upside unlikely before at least a detour below.
Natural Gas Feb Contract (NG, ETF: (UNG, UNL))
Sunday night’s gap down probed last week’s lows and attacked prior lows down to 2.89. The Thursday-Friday recovery setup depends upon closing above 2.95-3.05 through Monday-Tuesday to maintain the bottoming pattern.
Mid-day Update… Tease.
Last week’s lows hold a test, for now.
A bounce had become likely last week, after holding several tests of “lower prior highs” at 2625.00 through relevant timing windows. The bounce was not arbitrary, having neutralized attractions above. So, there is no bullish reason to revisit 2625.00.
And having chipped away so thoroughly at 2625.00, any bounce produced by its retest should be only obligatory. Actually, having chipped away so thoroughly at 2625.00, any bounce should be unlikely. But its test has reacted up to 2637.50.
The 2625.00 test wasn’t arbitrary. It bottomed upon testing this afternoon’s 2622.75 bias-down signal. Triggering bias-up would have been bullish, but only noN-bias triggered by still testing the 2633.75 bias-up signal both at 1:20 and 1:30. Its resistance doesn’t require holding, and its bias-up target doesn’t require being met.
Not yet leveraging this retest of 2625.00 into a new downleg today would undermine sellers greatly. A probe back into Friday’s range would become very likely. Back under 2633.00 would start to signal another attempt underway.
Look ahead: Economic Calendar – for Tue Jan 29, 2019
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: Any noticeable reaction to Tuesday’s pre-open reports is likely to be duplicated in reaction to the post-open reports. And one of those post-open reports is both high-profile and reliably influential to price action.
International Trade in Goods
8:30 AM ET
Retail Inventories [Advance]
8:30 AM ET
Wholesale Inventories [Advance]
8:30 AM ET
Redbook
8:55 AM ET
S&P Corelogic Case-Shiller HPI
9:00 AM ET
*Consumer Confidence
10:00 AM ET
2-Yr FRN Note Auction
11:30 AM ET
7-Yr Note Auction
1:00 PM ET