Posts by Rod David
Pre-close View… Down for the count.
Still hovering at session lows.
The bias environment’s 2081.00 exit was under the 2083.50 noon hour lows. But the final hour entry had bounced back into the bias environment’s range. Sellers could still gain traction by trending down to a fresh afternoon low through the 3:10-3:20 window.
That would make the decline likely to extend into and through tomorrow morning. Trending down tomorrow morning would otherwise require gapping under today’s lows.Similarly, trending up would require gapping up above today’s highs.
Paralysis or backing-and-filling remains likeliest ahead of tomorrow morning’s Yellen testimony.
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))
Rallying sharply overnight on better polling for Brexit’s “remain” vote filled the gap outstanding from 1.1400. Closing higher Tuesday would signal a bigger rally underway, and not just a temporary corrective bounce.
Gold Aug Contract (GC, ETF: (GLD))
Brexit’s “remain” vote makes Gold less attractive, so tumbling overnight was a likely reaction. But the retest of Thursday’s low and the 1286.50 pullback limit held, and closing above 1295.00 would signal the high’s retest underway targeting 1308.50 and po9ssibly 1312.00.
Silver Jul Contract (SI, ETF: (SLV))
Not much Brexit exposure, so not much volatility Monday. A retest of 16.40 and 16.80 remains likely.
30-year Treasury Sep Contract (US, ETF: (TLT))
Rallying stocks had no need for a flight-to-safety, triggering a gap down under the 169-00 pullback limit being tested at Friday’s close. Any early strength Tuesday back above 169-00 would be credible for resuming the rally to its 171-22 target.
Crude Oil Jul Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Testing the 48.00 bounce limit at Friday’s close was extra vulnerable to the weekend’s Brexit news. Gapping up and testing 49.00 Monday should be rejected back under 48.00 without delay to maintain near-term potential to test 45.00-45.40.
Natural Gas Jul Contract (NG, ETF: (UNG, UNL))
Last week’s shallow consolidation broke higher Monday morning and extended to test the 2.75 upper-end of long-standing target. Having been met quickly from the multi-session narrow consolidation, no second consecutive higher close Tuesday would make 2.47 and lower likely to be tested.
Mid-day Update… The other side of up.
Fresh post-open lows coming out of the noon hour.
Reacting down from 2092.50 never recovered. The 2084.50 opening print was retested, and held as support through the noon hour. Bouncing up to 2087.00 as the noon hour was ending had an opportunity to retest the highs.
But that was short-lived. Reacting down from 2087.00 probed a fresh post-open low — and the pre-open low, for that matter — down to 2082.00. The Pound suddenly collapsed simultaneously, so perhaps news is forthcoming on Brexit. Anxiousness ahead of Yellen’s testimony tomorrow could also be undermining the rally effort.
Regardless, the 2080.50 bias-down signal wasn’t touched, let alone triggered. This is a no-bias environment. Probing lower anyway would likely be recovered. Meanwhile, there is more room for noise to test this afternoon’s 2088.75 bias-up signal.
Look ahead: Economic Calendar – for Tue Jun 21, 2016
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: Tuesday’s sole econ report has no track record for influencing price action. Much more relevant is Fed Chair Yellen’s first of the two-day semi-annual congressional testimony. Her opening remarks are scheduled to be embargoed until 10:00am.
Redbook
8:55 AM ET
*Janet Yellen Speaks – Senate
10:00 AM ET
4-Week Bill Auction
11:30 AM ET
52-Week Bill Auction
11:30 AM ET
5-Yr Note Auction
1:00 PM ET
Afternoon Bias
| MON afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 2097.50 | 2088.75 |
| …would target | 2103.00 | 2094.50 |
| Bias-down: under | 2089.00 | 2080.50 |
| …would target | 2082.00 | 2073.25 |
| Signal status: NO-BIAS | 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.