Posts by Rod David
Open for business!
Power is restored, and the chaRTroom is available. This morning’s pre-market Tour is on schedule for 8:55am ET.
The First Trade… Follow-through.
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)*
*POWER OUTAGE HAS ME AND THE CHARTROOM OFFLINE. I’LL SEND AN EMAIL ALERT WHEN AVAILABLE. THANKS FOR YOUR PATIENCE!
Through the prior close…
More than being maintained, Monday’s gap up above prior highs trended upward to 2132.50 through the opening 15 minutes of volatility. This setup essentially marginalizes sellers from retaking control. But it doesn’t necessarily prevent downdrafts, like the post-open dip back to Friday’s 2125.50 high. Its touch reacted up aggressively to attack 2137.00 through the noon hour. Ranging choppily into the final hour didn’t gain traction, letting the day end by dipping to 2129.00.
Overnight action’s new info…
Choppy ranging was resisted by 2132.50 until breaking higher ahead of Europe’s opens. That became a surge through Monday’s highs testing 2138.00. A 4-point correction resolved up to fresh highs at 2141.50.
If, then…
At least one eventual new high close is required because Friday’s breakout was confirmed by Monday’s second consecutive higher close. That need not be today, but the “unfinished business above” does make it more difficult to reject a gap up. Reacting down from attacking, fulfilling or probing the 2143.00 objective might not be avoided, but it would likely be recovered.
First Trade…
[Click here to view the Bias parameters] Exiting the opening 15 minutes of volatility above 2143.00 would be likely also to exceed the 2141.00 bias-up target through 10:15 to renew the bias-up signal. Exiting the open above 2137.50 would be likely to trigger the 2135.00 bias-up signal at 10:15.
Morning Bias
| TUE morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2142.00 | 2135.00 |
| …would target | 2148.00 | 2141.00 |
| Bias-down: under | 2133.00 | 2126.00 |
| …would target | 2126.50 | 2119.50 |
| Signal status: BIAS-UP, BIAS-UP 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)
Monday finished with several mixed signals. They suggest that the rally isn’t required to extend higher immediately, but an immediate pullback would require eventual recovery.
Extending higher at all is aided by two factors. First is the proximity to the next higher objective at 2143.00, which was put into play by closing Monday above 2125.25. Second is Monday’s second consecutive higher close above Friday’s breakout close.
Momentum hasn’t reversed down, but the rally avoided triggering two of its sponsorships. First was Friday’s new trend high close, which had created the requirement for an eventual higher close. That attraction was neutralized already by Monday’s higher close.That’s not a sell signal, but it didn’t trap shorts.
Second is Monday’s 2127.50 gap up, which was tested after a dip touched Friday’s “lower prior highs.” It won’t become an attraction above to require recovery from a break lower.
A third factor challenging the upside is that Monday’s buyers gained no traction, so only maintaining a gap up Tuesday would signal new sponsorship had arrived.
I suspect the groundwork has been laid for 2-3 very volatile intraday sessions, with significant trending attempts in both directions. The end o’quarter earnings onslaught may be the catalyst, as warnings and beats fight it out on the news ticker.
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… Anchored.
Not trending, but also not reversing.
The bias environment began lapsing within the noon hour’s range. The final hour was entered within the bias environment’s range. No traction is being gained by the sponsorship of today’s rally.
Extending higher isn’t impossible, but must be signaled above 2135.25-2136.25. Breaking higher would target 2141.00-2143.00.
Otherwise, the balance of the session will more likely range flat-to-lower. Extending the pullback still has room down to 2129.00-2130.00, which doesn’t require being tested.