Posts by Rod David
The First Trade & Pre-open Tour Recording… Back at it.
Proper context can start the day with a solid win and make all the difference.
DAILY SCHEDULE
First, watch the pre-open Tour recording HERE <<==
Then, meet in the chaRTroom here by 9:15 ET for updates and Q&A
Through the prior close…
Thursday’s wild ride had begun Wednesday afternoon, when its test of the room for noise up to 2626.00 began reacting down. The close had slid through 2613.00-2616.00 on the way to an overnight test of ~2598.00 “lower prior highs.” Thursday’s 2606.00 open immediately resumed the overnight recovery, attacking 2626.00 upon exiting the noon hour. Despite triggering bias-up, the bias environment only ranged sideways until a China trade headline triggered a surge to 2645.50. The headline’s denial triggered a 20-point reaction down that still recovered to close at 2635.00-2636.00. The minimum requirement from Tuesday’s confirmed breakout for at least an eventual third higher close was fulfilled, while closing above 2626.00 put into play the rally’s next higher objective at 2656.00.
Overnight action’s new info…
Firming a little further to 2640.00 through Thursday’s close reacted down to 2633.00 through the Globex open. The recovery soon resumed until attacking Thursday’s 2645.50 high to within 3 ticks. Ranging narrowly sideways through midnight greeted Europe’s opens back down at 2640.00. It wasn’t very defensive, but it was defensive enough, and the earlier overnight high was recovered. Another dip to the range’s lower-end was also recovered, and now breaking through yesterday’s highs up to 2649.25.
If, then… (notes to accompany the Tour recording)
Overbought RSIs at yesterday’s high had required a retest which is now neutralized. The only higher objective in-play is 2656.00, which can be invalidated by opening back under 2626.00, but no such effort is apparent — closing under 2606.00 today would be the last opportunity to invalidate yesterday’s close above 2626.00. Meanwhile, this afternoon’s bullish WedEX influence could help to extend a morning rally, or to retrace a morning pullback. Regardless, this being a three-day holiday weekend, any sponsored trending should take place this morning. And this being a Friday, the morning’s bias often persists through the noon hour.
First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 above 2651.00 would be likely to exceed the 2647.50 bias-up target at 10:15 to renew the bias-up signal. Exiting the open at 9:45 above 2643.00 would be likely to trigger the 2640.00 bias-up signal at 10:15. Exiting the open under 2637.50 would be unlikely to trigger bias-up.
Morning Bias
| FRI morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2640.25 | 2640.00 |
| …would target | 2647.75 | 2647.50 |
| Bias-down: under | 2630.75 | 2630.75 |
| …would target | 2623.75 | 2623.75 |
| Signal status: BIAS-UP, BIAS-UP TARGET MET | . | |
| BIAS VIDEOS… INTRO // EXAMPLE | ||
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.
Market Wrap (recording & summary)
Thursday’s 2606.00 open was a 9-10 point improvement from the overnight low, which had held a test of ~2598.00 “lower prior highs.” Post-open action immediately resumed the overnight recovery, with a complete recovery to 2626.00 being the reward for having held the lower prior highs. Attacking it coming out of the noon hour helped to trigger the afternoon’s bias-up.
No sooner had the 2630.75 bias-up target become unfinished business, when a China trade headline triggered a surge to 2645.50. Its correction was hurried by an explicit denial of the original news. Reacting down 20 points was still recovered to close at 2635.00-2636.00.
Tuesday’s confirmed breakout had required an eventual third higher close, which is now neutralized. Not without creating new upside attractions. Simultaneously overbought 1-minute and 3-minute RSIs at the high require a retest. And closing above 2626.00 puts into play the rally’s next higher objective at 2656.00, which can be invalidated by exiting Friday’s open back under 2626.00. Overbought RSIs can be neutralized overnight, and the higher objective can be invalidated at the open, without interfering with WedEX’s bullish influence.
Details and other markets coverage are discussed in the post-market Wrap recording here.
Monitor overnight Globex trading in the chaRTroom here.
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 Mar Contract (EC, ETF: (FXE, UUP))
Fresh lows overnight were probed intraday Thursday after Wednesday’s ineffectual optimism. The buy signal can be lowered to 1.1475, with no requirement to trigger it, but no sell signal at work otherwise.
Gold Feb Contract (GC, ETF: (GLD))
Attacking the range’s upper-end on Wednesday only retraced back into the range on Thursday, still not resolving and becoming increasingly likely to break suddenly and sharply in one direction or the other.
Silver Mar Contract (SI, ETF: (SLV))
Sideways ranging persisted for yet another day, remaining vulnerable to a sudden explosion beyond the range in either direction, regardless of it possibly being a false breakout.
30-year Treasury Mar Contract (US, ETF: (TLT))
Gapping back up Thursday into the range was reversed to only fluctuate around the range’s 145-08 lower-end, still not signaling a break lower.
Crude Oil Feb Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Sideways ranging extended the hovering at recent highs, still likely at least to probe fresh highs regardless of the resolution.
Natural Gas Feb Contract (NG, ETF: (UNG, UNL))
Already retracing 61.8% of Wednesday’s intraday drop overnight produced a gap up Thursday. The 61.8% retracement held 3.56 intraday to range sideways and attack Wednesday’s close. There is no new signal.
Mid-day Update… Underlying strength.
3 ticks under yesterday’s high.
Reversing down through yesterday’s last 60-90 minutes, and extending down through Europe’s opens, has now been retraced to within 3 ticks of yesterday’s 2626.50 high. Such is the power and persuasion of 2626.00, not only as a repellent as its test fulfills buying pressure, but also as an attraction from testing support.
That support is the ~2598.00 “lower prior highs” that was tested overnight. Its intraday test would have been optimal and reliable, but that hasn’t mattered to the rally underway from the open. The 2626.00 attraction is actually the reward for having absorbed the interim drop.
Extending higher would suggest that 2658.00 may be tested before the weekend. But nothing requires trending any higher today. Wednesday’s confirmed breakout does require an eventual higher close, but not necessarily today. And WedEX’s bullish influence should be evident tomorrow afternoon. Sideways ranging or an interim dip wouldn’t affect either setup.