Posts by Rod David
Pre-market Tour (recording & summary)
The overnight drop’s consolidation continues ranging around yesterday’s 2160.00 lows, at this morning’s 2160.75 bias-down signal. A Symmetrical Triangle has formed, so a breakout would be credible for extending, with potential to retest the Triangle before resuming the breakout. And that retest would have some potential to reverse back into and through the Triangle, if done during the opening 15 minutes of volatility.
Details and other markets coverage are discussed in the pre-market Tour recording here.
The First Trade… Picking up where yesterday left off.
Proper context can start the day with a solid win and make all the difference.
CHARTROOM LINK
(pre-open Market Tour begins at 8:55 ET)
Through the prior close…
Sunday night’s “new Globex trend extreme” at the 2177.75 overnight high was left outstanding Monday, and its eventual retest is required. But opening back in Friday’s range and staying thee isolated the overnight highs, so that intraday sentiment could take an opposite tack. The noon hour’s 2160.00 area lows held through the afternoon, as did 2166.00 resistance. No other “unfinished business” was created and no traction was gained.
Overnight action’s new info…
Monday’s closing attack on 2166.00 resistance was soon broken by a rally to 2171.00. Its reaction drifted back down to 2166.00 ahead of Europe’s opens, which triggered a steep drop back down through Monday’s lows to 2157.50. Now a bounce ranging a couple points back above Monday’s lows.
If, then…
The next lower objective would be to retest Thursday’s 2153.50 low, as a consequence to Friday morning’s trending above Thursday’s highs without traction. Despite the overnight slide, not already trending down at Tuesday’s close would make the 2177.75 high’s retest likelier, first. Gapping down under Monday’s 2160.00 lows would likely trend down through the morning. Regardless, nothing can change Monday’s sentiment peak setup, and intraday reaction’s confirmation. The burden of proof is back on buyers.
First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 above 2166.00 would be unlikely to trigger the 2160.75 bias-down signal at 10:15. Exiting the open under 2158.00 would be likely to trigger bias-down.
Morning Bias
| TUE morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2176.25 | 2170.50 |
| …would target | 2181.25 | 2175.50 |
| Bias-down: under | 2166.50 | 2160.75 |
| …would target | 2160.00 | 2154.25 |
| Signal status: BIAS-DOWN, BIAS-DOWN TARGET MET | FAQ | |
| INTRO VIDEOS #1 and #2 | ||
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.
Post-market Wrap (recording & summary)
A “new Globex trend extreme” at the 2177.75 overnight high was left outstanding Monday. It is almost historically mandated to be retested intraday before a durable downleg can begin. Meanwhile, a sizable downleg is possible.
Despite Monday afternoon’s flat-to-higher narrow ranging, the next lower objective would be to retest Thursday’s 2153.50 low. By the same token, because of Monday afternoon’s flat-to-higher narrow ranging, not already trending down into Tuesday’s close would make the 2177.75 retest likelier, first.
But nothing changes whether greeting the week with extreme sentiment can easily be a sentiment peak. And nothing changes that its intraday reaction down wasn’t rejected. The burden of proof is back on buyers.
Details and other markets coverage are discussed in the post-market Wrap recording here.
Monitor overnight Globex trading in the chaRTroom here. Contact me immediately if you encounter any difficulty.
Pre-close View… The big one.
Corrective bounce ended, decline ready to resume.
The template we discussed before the open has not been invalidated. The open’s slide and the late-morning’s plunge each corrective. One more in terms of price than in duration. The other shallower but lasting longer.
The noon hour’s test of 2160.00 had reacted up 6 points, and now 2160.00 is being retested. There’s no bullish reason for that this late in the session in this pattern. A break lower should be imminent.
Whether met today or tomorrow, the next downleg’s objective is to probe under Thursday’s 2153.50 low. A bigger decline is probably underway, originating with the sentiment extreme that was indicated by the open’s price action. Recovering this afternoon’s 2166.00 highs would suggest otherwise.