Posts by Rod David
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 Jun Contract (EC, ETF: (FXE, UUP))
Having fulfilled the minimum requirement Tuesday from last week’s confirmed breakout, Wednesday’s narrow ranging firmed, only back up to Monday’s high, leaving the decline’s momentum intact.
Gold Jun Contract (GC, ETF: (GLD))
The next lower objective under 1241.00 at 1223.00 had been put into play by closing Tuesday under 1236.50. Probing under it and under 1218.00 intraday was still overlapping 1223.00 into the afternoon. But closing negative confirms Tuesday’s breakout from a multi-session range, requiring at least an eventual third lower close.
Silver Jul Contract (SI, ETF: (SLV))
Wednesday’s inside day ranged exclusively in negative territory after gapping down, continuing its relative outperformance to Gold. But “ineffectual pessimism” or not, attraction above to the 16.50 anchor is still trying to prevent another downleg.
30-year Treasury Jun Contract (US, ETF: (TLT))
Tuesday night’s dip probed back into the 163-16/163-22 pullback limit that had limited the intraday reaction down. Wednesday fluctuated narrowly, barely attacking the 164-17 buy signal while twice dipping to test its pullback limit.
Crude Oil Jul Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Probing above 49.00 Wednesday instead of reacting down almost immediately from its Tuesday test has created a target at slightly higher highs up to 49.95 and potentially 51.45. But now closing back under 48.40 would signal momentum reversing down.
Natural Gas Jun Contract (NG, ETF: (UNG, UNL))
Wednesday morning wasted no time duplicating the two prior day’s relentless drop, extending back down to last week’s 1.95 spike low.
Look ahead: Economic Calendar – for Thu May 26, 2016
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: Fed speaker “Bull”ard’s timing makes him less likely to influence price action. Post-open Durable Goods has a long track record of influence. Impact by the noon hour’s Fed speaker is more likely for its timing during an otherwise less liquid noon hour.
James Bullard Speaks
5:15 AM ET
*Durable Goods Orders
8:30 AM ET
Jobless Claims
8:30 AM ET
Bloomberg Consumer Comfort Index
9:45 AM ET
Pending Home Sales Index
10:00 AM ET
EIA Natural Gas Report
10:30 AM ET
Kansas City Fed Manufacturing Index
11:00 AM ET
*Jerome Powell Speaks
12:15 PM ET
7-Yr Note Auction
1:00 PM 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 | 2092.25 | 2089.50 |
| …would target | 2097.50 | 2094.75 |
| Bias-down: under | 2085.00 | 2082.25 |
| …would target | 2078.75 | 2076.00 |
| 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… Clean plate club.
Straight out of the open, straight up, straight to its target.
The overnight rally had met the 2085.75 bias-up target to within 1 tick. Its pre-open pullback pierced this morning’s 2080.50 bias-up signal by 1 tick. The post-open recovery didn’t hesitate. A buy signal quickly triggered above 2083.75 and extended to fresh highs.
Minutes after renewing the bias-up signal at 10:15, the 2092.00 renewed bias-up target was touched. Its 3-1/2 point reaction down has violated the pullback limit. Simultaneously overbought 1-minute and 3-minute RSIs at the high require its retest.
If not for the high’s required retest — probably up to 2092.75 — a sell signal would already have triggered. A little deeper pullback under 2088.25 would be likely to extend to 2084.00 before recovering.
This may be an opportunity for the rally’s sponsorship to rest, refueling by letting shorts trap themselves. A repeat of yesterday’s session-long rally is not impossible, but also not likely.
Pre-market Tour (recording & summary)
Rallying overnight to attack this morning’s bias-up signal is running the risk of the open attracting more strong-handed sellers than buyers. Probing above 2079.75 but not maintaining it through the open would suggest that trending will invert back down. Successfully negotiating that hazard could point sharply higher this morning.
Details and other markets coverage are discussed in the pre-market Tour recording here.