Posts by Rod David
The First Trade… Already there.
fProper 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…
Firming out of the weekend made it clear there was no excuse to further delay not only probing fresh highs, but trending higher. The morning’s 9-point surge to 2109.00 Completely retracing it in reaction to Yellen’s comments was nevertheless recovered by a 13-point surge testing 2112.00. Fulfilling the morning’s “unfinished business above” let the last 60-90 minutes drift back to 2107.25 into the close.
Overnight action’s new info…
The late-afternoon pullback limit of 2107.25 had held its touch pre-close, allowing a deeper dip overnight that could avoid gaining traction. But only 1 point lower was probed before firming back toward Monday’s highs. Europe’s opens triggered a surge to fresh highs that extended to touch 2116.00. Its reaction down has touched 2113.00.
If, then…
The lower-end of the rally’s next higher objective at 2116.00-2119.00 was touched. It wasn’t put into play by closing above its last objective, so it is more vulnerable to rejection upon being tested intraday. Especially early, if its test reverses back under yesterday’s ~2112.00 high through the open, which could put sellers in control of the morning. Otherwise, maintaining a gap up would keep alive the entirety of the 2116.00-2119.00 objective, and potentially 2125.25.
First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 above 2113.00 would be likelier to trigger the 2111.50 bias-up signal at 10:15, and under 2109.00 would be less likely.
Post-market Wrap (recording & summary)
Note: A technical problem interrupted the Wrap’s recording, so the discussion is unavailable until halfway through. I’m awaiting a support response to troubleshoot recovery methods, and will email if it becomes available.
Pullback potential to 2107.25-2108.50 was being probed before finally fully fulfilling it at the cash session’s very last minute. That was too late for reacting up enough to suggest another long-entry, let alone a hold-long through the close.
The rally’s probe of fresh highs and new high closed gained no traction for its effort. So, extending the rally higher without delay would require gapping up Tuesday. Otherwise, the uptrend would be unlikely to resume before the afternoon bias environment had begun lapsing.
The current ES futures front-month has twice probed last Fall’s last relative high. This had long ago become the recovery’s minimum objective. SPX cash is still 3 points short. Regardless, its test was never likely to withstand probing higher, even if only temporarily. But “unfinished business above” is quickly disappearing.
Details and other markets coverage are discussed in the post-market Wrap recording here.
Monitor overnight Globex trading in the chaRTroom here.
Morning Bias
| TUE morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2113.25 | 2111.50 |
| …would target | 2118.50 | 2117.00 |
| Bias-down: under | 2103.75 | 2102.25 |
| …would target | 2097.25 | 2095.50 |
| Signal status: BIAS-UP | 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.
Pre-close View… Testing targets.
Afternoon probing fresh highs.
Delaying the decline’s resumption today was unlikely. The morning’s 9-point post-open rally to 2109.00 might have seemed enough productivity, but the effort created a higher objective at 2110.75.
After retracing all of the post-open gain in reaction to Yellen’s noon hour comments, that higher objective attracted price back up to fresh highs at 2112.25.
2110.75 was being overlapped while the bias environment lapsed from 2:30-3:00. So, the next higher objective at 2116.00-2119.00 isn’t necessarily in-play. But neither is it rejected.
Back above 2112.00 would signal the next higher objectives are in-play. Meanwhile, a pullback has room down to 2107.25-2108.50 before suggesting a deeper pullback is underway.
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))
Monday eked out a slightly higher high intraday to threaten confirming that Friday’s surge had reversed momentum up, requiring at least an eventual third higher close with potential to 1.1510. An interim dip — whether or not corrective — would be signaled back under 1.1290.
Gold Aug Contract (GC, ETF: (GLD))
Choppily eking out a slightly higher high intraday Monday threatened confirming that Friday’s surge had reversed momentum up, which would require at least an eventual third higher close having potential to 1260.00. An interim dip — whether or not corrective — would be signaled back under 1236.50.
Silver Jul Contract (SI, ETF: (SLV))
Gapping up a little Monday held 16.50 resistance, and still avoided the 16.60 buy signal which would otherwise suggest a bigger corrective bounce underway before retesting last week’s Island pattern at the lows.
30-year Treasury Sep Contract (US, ETF: (TLT))
Closing Friday above the long-standing 166-12 target had not put into play higher objectives, while intraday action formed an Ascending Triangle. Room for noise above it up to 167-00 was tested Sunday night before reacting down Monday to 165-29, and likely also to test 165-16.
Crude Oil Jul Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Surging ahead of Monday’s open only attacked the original 49.95 objective to within a nickel before weakening through the morning back to last week’s “lower prior highs.” Gapping up and trading exclusively in positive territory without maintaining a probe above prior highs is “ineffectual optimism” that often resolves down without delay.
Natural Gas Jul Contract (NG, ETF: (UNG, UNL))
Leaving Friday’s gap up outstanding had not reversed down sustainably into negative territory, keeping the door open to extending the rally, which was done by Monday’s probe of fresh highs.