Posts by Rod David
Pre-market Tour (recording & summary)
Touching 2092.50 several times has finally reacted down, dipping to 2089.25 That would suffice for stretching the rubber band to launch an immediate post-open upleg. Back above 2091.25 would start to confirm. Otherwise, a deeper dip is possible down to 2087.50 before suggesting the morning will be biased downward, instead.
Details and other markets coverage are discussed in the pre-market Tour recording here.
The First Trade… Big things, little packages.
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…
Thursday’s two no-bias environments reflect the session’s limited range, but not its relevance. Opening slightly higher at 2091.75, but still under Wednesday’s highs, the morning trended back down to probe under Wednesday’s lows to 2084.25. The afternoon gradually, choppily trended back up into positive territory, still under the morning’s highs. Traction may have been gained, barely, by exiting the bias environment 2-3 ticks above the noon hour’s highs and trending up by 2-3 ticks to fresh afternoon highs through the 3:10-3:20 window.
Overnight action’s new info…
Immediately extending higher touched 2092.50. Trending back down greeted Europe’s opens at 2088.00 session lows. The open’s 2092.50 high was soon recovered, and is being retested now.
If, then…
If the rally gained traction Thursday, it wasn’t decisive, and it hasn’t yet been rewarded. That could be the most bullish feature of all, if that is actually patience or restrained optimism. Narrow overnight ranges often resolve aggressively at the intraday open, which would likely be up. The only “unfinished business” is above at 2094.75, and an eventual third higher close to fulfill Tuesday’s confirmed breakout, all within the context of resuming a steep recovery leg. This being Friday — ahead of a three-day weekend, no less — “Friday Factors” can interfere and invert those influences, or leverage them.
First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 above 2094.75 would be likely to trigger the 2092.75 bias-up signal at 10:15. Exiting the open under 2087.50 would be unlikely to trigger bias-up.
Morning Bias
| FRI morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2095.00 | 2092.75 |
| …would target | 2100.75 | 2098.50 |
| Bias-down: under | 2085.75 | 2083.50 |
| …would target | 2079.25 | 2077.00 |
| Signal status: noN-BIAS, TESTED BIAS-UP SIGNAL | 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)
Thursday afternoon’s bias environment exit was slightly above the noon hour’s high. The 3:10-3:20 window firmed its way to fresh afternoon highs. Neither was decisive, and combining them doesn’t greatly enhance the whether the rally gained traction for Thursday’s efforts.
Regardless, any reward the effort earned hasn’t yet been awarded. The last half-hour reacted down from 2090.50 to 2087.00. But that has been recovered to a fresh high at 2091.00.
The ongoing narrow range that began after Wednesday morning’s surge doesn’t require resolving either way Friday. Sponsorship is difficult to generate during thinning participation (as if this week weren’t already lightly attended) ahead of the three-day weekend. Counter-trend sponsorship is difficult to generate, too. So just trying to resolve the range could be enough to produce a significant move, or a rubber band effect.
There’s a catalyst for that. Fed Chair Yellen is scheduled to speak Friday during the afternoon bias environment. one hour after Friday’s open. She may reinforce trending underway already in anticipation of her remarks, or prove they were overly-discounted and trigger a reversal. With three days of illiquidity just minutes away, any reaction is likely to be very aggressive, if not altogether brief.
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… Waiting for an engraved invitation?
Narrow range now free to resolve.
The afternoon bias environment is lapsing. The shallow backing-and-filling influence we expected for today is no longer influential.
Resuming the rally today would also be likely to produce the eventual third higher close that became required by Tuesday’s confirmed breakout. Despite neutralizing that upside objective, the momentum could carry price higher into the three-day weekend.
If not already probing fresh highs into the final hour, then another dip to session lows would be likely. And a dip to session lows would be vulnerable also to extending another 10 points lower from there, into the mid-to-low 2070‘s. That could also drift into the holiday weekend.
The narrow, sideways drift that began after yesterday morning’s surge could persist. Flat-to-lower ranging into the weekend is possible, too. But a false break up isn’t likely, so almost any probe of fresh highs should be reliable for extending higher.