Posts by Rod David
Mid-day Update… Treading water.
Gap down not yet extended.
Gapping down to this morning’s 2181.25 bias-down signal had extended immediately to touch 2177.00. Its first reaction up to 2182.50 has yet to be exceeded, despite the initial break lower having yet to extend. Regardless, the 2174.25 bias-down target became “unfinished business below.”
Ranging narrowly this morning was contained essentially between the resistance of the 2181.25 bias-down signal, and an inflection point at 2179.00 as support.
2179.00 has been broken, but not deeply enough to trigger this afternoon’s 2177.00 bias-down signal. Price is consolidating optimistically short of touching 2177.00.
Breaking under 2177.00 before the bias environment begins lapsing would be “no-bias trending” that requires being retraced before a deeper drop would be credible. Delaying the break or overlapping 2177.00 until then could trend down into the close.
Potential for bouncing instead can’t yet be dismissed. But the nearest buy indication of momentum reversing up wouldn’t be triggered under the 2183.00 area.
Look ahead: Economic Calendar – for Wed Aug 17, 2016
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: Wow, a Fed speaker is scheduled as the less liquid noon hour ends, just as price action usually becomes paralyzed by anxiousness ahead of a Fed event — FOMC Minutes, in this case.
MBA Mortgage Applications
7:00 AM ET
Atlanta Fed Business Inflation Expectations
10:00 AM ET
EIA Petroleum Status Report
10:30 AM ET
*James Bullard Speaks
1:00 PM ET
*FOMC Minutes
2:00 PM ET
WedEX option expiratiopn bias signal
4:00 PM ET
Afternoon Bias
| TUE afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 2186.75 | 2183.75 |
| …would target | 2192.50 | 2189.50 |
| Bias-down: under | 2180.00 | 2177.00 |
| …would target | 2175.00 | 2172.00 |
| 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… Down for the count.
Gap down triggers bias-down.
Opening at this morning’s 2181.25 bias-down signal immediately slid to 2177.00. An inflection point under 2179.00 was triggered along the way. But it wasn’t exceeded deeper than its first 3 minutes before reacting up to retest 2181.25 as resistance.
2181.25 was still being tested at 10:15 to invoke the grace period, but ultimately triggered late bias-down. The 2179.00 inflection point was tested and retested, not yet to new lows but attacking them.
The 2174.25 bias-down target is in-play. Last Wednesday’s gap back down to 2172.00 is probably in-play too, as gaps tend to be filled in pairs. Without printing a fresh post-open low, recovering 2182.50 as the bias environment lapses would invalidate the late bias-down.
Pre-market Tour (recording & summary)
The earlier 5-point bounce up to 2186.00 had been largely retraced already, and then entirely on the way to fresh lows at 2180.25. That’s within 1 tick of filling the gap back to last Friday’s cash session close. That would be “optimistically short” if done post-open, bearish from a contrarian perspective. Instead, a bigger bounce could retest yesterday’s highs up to 2189.50. Not holding the gap would target 2172.00, another outstanding gap — and gap fills do tend to come in pairs.
Details and other markets coverage are discussed in the pre-market Tour recording here.