Posts by Rod David
CORRECTION regarding WedEX
My post-market summary identified the WedEX signal as being bearish, which is incorrect. As we discussed during the post-market Wrap, WedEX was bullish.
The post has been corrected in the blog.
Morning Bias
| THU morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2156.25 | 2149.50 |
| …would target | 2161.50 | 2154.75 |
| Bias-down: under | 2147.00 | 2140.25 |
| …would target | 2140.50 | 2133.75 |
| Signal status: BIAS-UP, BIAS-UP TARGET EXCEEDED | 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)
Wednesday’s overnight probe above Tuesday’s high to 2152.25 came too late to be sponsored by strong hands. The open’s shallow gap up to 2150.75 confirmed as much, as did its immediate reversal back down into negative territory. That created the requirement to test 2141.00, which the morning probed down to 2139.50.
But that’s as far as sellers got. And they could have gotten away with much more. If that were due to patience, then the close would not have been unchanged and back above the prior afternoon’s low. Sellers didn’t exploit the opportunity to trend down, which suggests they are weak hands.
Gapping down Thursday under Tuesday and Wednesday’s ~2138.00 lows would signal stronger handed sellers had arrived, at least for the morning. Similarly, immediately resuming the rally Thursday morning would require gapping up above Wednesday’s 2149.00 highs — being an easier task doesn’t make it any likelier to be exploited, either.
Two observations of the bigger picture: First is that Wednesday was a second consecutive higher close above 2143.00. An interim dip would be likely to recover to fresh highs targeting 2158.00 and potentially also 2168.00. Second is a bearish bullish WedEX signal triggered. So, from whatever level at the time, Friday afternoon and Monday morning will likely be biased down.
Details and other markets coverage are discussed in the post-market Wrap recording here.
Monitor overnight Globex trading in the chaRTroom here.
Pre-close View… The coast is clear.
Backing-and-filling can resolve up now, if it wants.
This morning’s drop down to 2139.50 neutralized the attraction below, and reacted up. Bouncing to 2144.00 during the noon hour and to 2145.50 during the afternoon bias environment has extended to greet the final hour testing 2147.25.
That was this afternoon’s bias-up signal. It’s still resistance, but probing it wouldn’t be “no-bias trending” doomed to failure. Probing higher now can run.
Exploiting the opportunity could have marginalized sellers through tomorrow morning. But the final hour wasn’t yet entered above the bias environment’s high. And it’s still being tested.
Retesting the 2152.25 overnight high is the likely reward for absorbing today’s dip. That’s possible now that the last hour has arrived.
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 Sep Contract (EC, ETF: (FXE, UUP))
Wednesday’s open pierced Tuesday’s high in the 1.1140 area whose recovery would signal a bigger detour likely to test 1.1300 before fulfilling the retest of recent lows.
Gold Aug Contract (GC, ETF: (GLD))
Wednesday morning’s strength consolidated just under the 1346.50 buy signal that would confirm Tuesday’s retest of Friday’s spike low had satisfied selling pressure.
Silver Jul Contract (SI, ETF: (SLV))
Gapping up Wednesday ranged exclusively in positive territory while testing the week’s prior highs without extending higher. This “ineffectual optimism” would be more convincing had 20.52 prior highs been probed instead of barely touched. That’s pessimism. Any breakout attempt would be credible for extending to retest pre-Brexit highs.
30-year Treasury Sep Contract (US, ETF: (TLT))
Gapping up Wednesday tested the 174-24 pullback limit which Tuesday’s open had gapped down to and through. The gap back to Monday’s close is likely to be filled, too, potentially to also probe within its range up to 164-10 before completing the topping pattern.
Crude Oil Aug Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Tuesday’s bounce above 46.00 attacking 47.00 was reversed down sharply in reaction to Wednesday morning’s EIA report, filling the gap back down to Friday’s 44.78 close and reconfirming the likelihood for at least testing 43.00.
Natural Gas Sep Contract (NG, ETF: (UNG, UNL))
Gapping up to test 2.80 Wednesday was reversed down intraday to test recent lows down to 2.70. Closing back in positive territory would greet Thursday’s EIA report from a position of strength — not necessarily capable of avoiding a knee-jerk reaction down, but likely to recover, if not already rallying..