Posts by Rod David
Look ahead: Economic Calendar – for Thu Jul 7, 2016
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: Thursday morning’s ADP is reliable for influencing price action. It also helps us to gauge market sentiment ahead of Friday’s Employment Situation report. Any reaction Thursday is likely to be duplicated by the morning’s other reports. The late-morning EIA reports (stacked due to the holiday-shortened week) include Crude Oil, which is reliable for triggering a reaction.
Challenger Job-Cut Report
7:30 AM ET
*ADP Employment Report
8:15 AM ET
Jobless Claims
8:30 AM ET
Gallup Good Jobs Rate
8:30 AM ET
Bloomberg Consumer Comfort Index
9:45 AM ET
EIA Natural Gas Report
10:30 AM ET
*EIA Petroleum Status Report
11:00 AM ET
Fed Balance Sheet
4:30 PM ET
Money Supply
4:30 PM ET
Afternoon Bias
| WED afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 2093.50 | 2085.00 |
| …would target | 2099.50 | 2091.00 |
| Bias-down: under | 2084.50 | 2076.00 |
| …would target | 2079.50 | 2071.00 |
| Signal status: BIAS-UP | 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… Second chances in a choppy market.
Another double-pumped recovery fails.
Last night’s dip under yesterday’s 2072.25 lows had recovered back up to fresh overnight highs. But that wasn’t maintained, and overnight lows were probed.
A bounce greeted the open, and it quickly touched the 2076.00 bias-down signal as resistance. Quickly reacting down to 2068.00 was recovered back up to fresh post-open highs. But that wasn’t maintained, and overnight lows have been probed even lower.
Sellers and buyers both are getting a lot of second chances. And those second chances are being exploited.
Buyers now have a second chance to retake control. The 2071.00 bias-down target wasn’t broken through 10:15, so the bias-down signal is not renewed. The target had been met already, and it was met later anyway, while RSIs avoided becoming oversold. The nearest renewed bias-down target has been met, too.
None of which changes that this is a bias-down environment. But renewing the bias-down signal at 10:15 would have essentially put into play 2055.00-2056.50. That was avoided. It can be exploited by exiting the bias environment in rally mode recovering 2076.00.
Otherwise, 2055.00-2056.50 is the next lower objective, and the next opportunity to launch a rally back through last week’s highs.
Pre-market Tour (recording & summary)
The overnight low’s retest had reacted up to test 2073.50. It’s being retested now ahead of the open. Holding above 2071.00 and quickly recovering 2075.00 could marginalize sellers, at least until filling the gap back up to yesterday’s 2080.00-2083.00 closes. Otherwise, triggering bias-down could itself imply the bias-down target won’t hold, either.
Details and other markets coverage are discussed in the pre-market Tour recording here.
The First Trade… Dancing on the edge.
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…
Ultimately trending down through July 4 greeted the holiday-shortened week gapping down 4-1/2 points under 2089.75. Its recovery through Friday’s close had created a requirement for eventually probing prior highs. Fresh lows into the afternoon attacked 2072.00, leaving no “unfinished business below,” but not forming a solid base. Bouncing into the close was unlikely to be maintained.
Overnight action’s new info…
Attacking 2085.00 resistance was reversed back down to probe well under Tuesday’s lows. A recovery began before midnight from 2067.50, probing a fresh high at 2085.75 through Europe’s opens. That sizable rally was rejected, dropping entirely back down to fresh lows at 2066.75. And now that sizable drop is reacting back up, at least to 2072.50.
If, then…
The most bullish scenario described during yesterday’s Wrap was to greet this morning’s open already in recovery mode from an overnight retest of yesterday’s lows. Price action through Europe’s opens seemed to be on that path, having reversed back up through yesterday’s close. Rejecting the entire overnight recovery could still try, try again. But triggering bias-down, even without renewing it under the target, could extend next to 2055.00-2056.50.
First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 under 2069.25 would be likely also to exceed the 2071.00 bias-down target through 10:15 to renew the bias-down signal. Exiting the open above 2077.75 would be unlikely to trigger the 2076.00 bias-down signal at 10:15.