Posts by Rod David
Post-open Review… Quicksand again?
Selling satisfied, not rejected.
If this morning were to be about backing-and-filling this morning, instead of about retesting overnight highs, then its start was likelier to be aggressive.
And it was. The 2163.75 overnight low was retested during the first 5 minutes. And a downtrending channel formed through the opening 15 minutes.
Breaking lower fulfilled the 2158.00 bias-down target at 10:15, just as the 2163.75 bias-down signal was triggering. There’s no grace period for renewing the signal, so this is a bias-down environment whose target has been met.
Simultaneously oversold 1-minute and 3-minute RSIs at the low require its retest, potentially down to 2156.00 without signaling a deeper drop underway. Back above 2161.50 at any time would start to signal momentum already reversing up.
2158.00 represents the same area as last Tuesday’s session-long quicksand struggle. So, exiting the bias environment in rally mode may be necessary to avoid a deeper drop. And the reward may be to retest overnight highs already today.
Pre-market Tour (recording & summary)
Pre-open fluctuation is still overlapping Friday’s 2168.00 close, essentially unchanged. Lacking momentum this near the open doesn’t prevent suddenly finding sponsorship to attempt trending. But whether probing fresh highs up to 2175.50 or backing-and-filling down to 2060.50, durable trending is unlikely.
Details and other markets coverage are discussed in the pre-market Tour recording here.
The First Trade… Bubbling up.
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…
Simply not gapping down Friday was already unlikely to resume Thursday’s decline. Greeting the open unchanged around 2058.00, but having pulled back from an overnight rally up to 2165.00, Friday rallied throughout up to 2169.00..
Overnight action’s new info…
Opening flat Sunday night around 2168.00 eventually surged to fresh highs at 2172.50. That was retraced as quickly, and soon reversed into negative territory. A blip-down testing 2163.75 in reaction to Europe’s opens was recovered to 2171.25. That has returned back down to 2168.00 instead of yet extending higher.
If, then…
The overnight high was not complex, so it was not a “new Globex trend extreme” that would otherwise require intraday retest. But it’s likely, anyway. Even without Friday’s rally gaining traction, potential remained intact up to 2171.25. Further potential up to 2175.50 became likelier for having absorbed Thursday’s detour down to 2153.50 and to compensate for a terror-related event in Munich having inhibited Friday afternoon’s rally leg. Not holding last night’s low could trigger a morning pullback instead.
First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 under 2162.00 would be likely to trigger the 2163.75 bias-down signal at 10:15. Exiting the open above 2168.00 would be unlikely to trigger bias-down. Exiting the open above 2171.25 would be likely to trigger the 2169.00 bias-up signal.
Overnight Globex chaRTroom link
Has an entire weekend actually elapsed without any geopolitical shock waves greeting the Globex open? That seemed to have become the norm. I have faith in the market begin able to absorb this surprising circumstance. We’ll monitor the open at 6:00 PM ET anyway to be sure.
Saturday Review’s recording (for 7/23/16) …
New highs printed last week, in what became a failed breakout. A detour down was recovered into the weekend, but only recovered — not exceeded. All within a target area that is the rally’s highest calculable objective for this leg.
This week’s FOMC policy statement could hardly be greeted by a more interesting environment. We discuss the relevant levels and likely paths in this week’s Saturday Review.
The following stock requests were reviewed in this order:
UA,CSCO, FB GOOGL, AMZN, GDX
07/23/2016 09:29:14 David B: good morning
07/23/2016 09:31:53 Mark Glezer: gm
07/23/2016 09:56:37 Mark Glezer: there is no requirement for a new high close?
07/23/2016 09:57:43 Mark Glezer: yes
07/23/2016 09:59:00 David B: don’t we need to see distribution before we start to see a change in the trend?
07/23/2016 10:04:54 David B: i think you mentioned last week this rally has not been the strongest of stronger hands. what would tell us stronger stronger hands were behind the rally?
07/23/2016 10:05:16 Mark Glezer: pivot reversal potential on a gap down or a key reversal on a gap up, pivot would be more bearish here?
07/23/2016 10:09:48 David B: still not a bull market?
07/23/2016 10:10:15 David B: with two consective closes
07/23/2016 10:17:02 Mark Glezer: pivot behavior would still be more bearish here?
07/23/2016 10:17:36 David B: UA,CSCO
07/23/2016 10:19:24 David B: FB,GOOGL
07/23/2016 10:20:37 David B: UA earnings on tues
07/23/2016 10:32:56 David B: are FB and google showing optimism ahead of earnings this week?
07/23/2016 10:34:31 David B: wed
07/23/2016 10:34:41 David B: google on thursday
07/23/2016 10:36:19 David B: that could drive the market higher to 2225?
07/23/2016 10:37:19 David B: amzn this week also
07/23/2016 10:39:18 Josey: Ty
07/23/2016 10:39:21 David B: thanks