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))
Gapping down Thursday to reject Wednesday’s bounce to recent highs had made the decline’s resumption imminent, which Friday’s open fulfilled by gapping down sharply and extending down deeper to fresh lows.
Gold Jun Contract (GC, ETF: (GLD))
Another overnight bounce was rejected into the open Friday, this time probing under Thursday morning’s prior low. But the balance of the session recovered to range choppily around unchanged.
Silver Jul Contract (SI, ETF: (SLV))
Gapping down to a fresh low at Friday’s open was retraced back to the gap at Thursday’s 17.10 close, ranging narrowly through the close.
30-year Treasury Jun Contract (US, ETF: (TLT))
The 165-00 pullback limit had held its test Thursday, and gapping up Friday extended up to fresh highs that keep intact the 166-30 objective, which is likely to be tested up to 167-26.
Crude Oil Jun Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Slightly lower lows overnight didn’t qualify as rejecting Thursday’s fresh high, which had fulfilled the outstanding requirement for a new high close.
Natural Gas Jun Contract (NG, ETF: (UNG, UNL))
Gapping down Friday filled the gap back to Tuesday’s 2.08 close, and then recovered back above 2.14 to signal momentum reversing up. A second consecutive higher close Monday would confirm the new rally leg underway.
Mid-day Update… Flooding the compartment.
Latest attack on yesterday’s lows was not rejected.
If this morning didn’t trend, then this afternoon was unlikely to only range. Much likelier was to produce the trend that the morning could have produced, regardless of direction. Ultimately, the direction would be dependent on yesterday’s lows being compartmentalized.
Not exactly yesterday’s lows, bu the structure at yesterday’s lows.
The overnight dip was recovered at the open to compartmentalize its probe into (and through) yesterday’s lows. A post-open dip was recovered into the 10:15 bias timing window to compartmentalize another probe. Even the morning’s bias environment probed the structure and recovered it before the bias environment began lapsing. Compartmentalized.
The noon hour didn’t get the memo.
Triggering late bias-down under 2054.25 has extended through its 2049.00 bias-down target. Last Friday’s 2045.00 lower prior highs is being probed by more than 1 point. Room for noise below it is 2042.00.
Exiting the bias environment back above 2047.00 would start signaling the downside momentum was lapsing, confirmed back above 2052.00. Back above 2056.00 would be pretty bullish, especially if maintained through the close. Exiting the bias environment under 2042.00 could meltdown into the weekend, which had been the less likely bearish scenario.
Look ahead: Economic Calendar – for Mon May 16, 2016
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: Neither of Monday’s two scheduled econ reports has a track record for influencing price action, although the Housing Market index is the first housing sector data in more than a week.
Empire State Mfg Survey
8:30 AM ET
Housing Market Index
10:00 AM ET
3-Month Bill Auction
11:30 AM ET
6-Month Bill Auction
11:30 AM ET
Treasury International Capital
4:00 PM ET
Afternoon Bias
| FRI afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 2064.75 | 2060.50 |
| …would target | 2070.00 | 2065.75 |
| Bias-down: under | 2058.50 | 2054.25 |
| …would target | 2053.25 | 2049.00 |
| Signal status: LATE BIAS-DOWN | 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… Today’s stolen punchbowl count is 2.
Both a pre-open AND post-open rally fail.
The recipe to rallying this morning was to compartmentalize the overnight probe of the structure at yesterday’s lows. A pre-open dip to 2053.25 had injected a healthy dose of pessimism into the overly-optimistic overnight recovery. The 2057.00 opening print trended up to 2063.50 through the opening 15 minutes of volatility.
None of which prevented sliding back down to a fresh post-open low, piercing the pre-open low down to 2052.75.
This morning’s 2055.25 bias-down signal didn’t trigger, still being overlapped both at 10:15 and 10:30 to signal noN-bias. No requirement either to test the 2049.75 bias-down target, or for an offsetting test of the 2065.75 bias-up target.
Fresh lows would still be likely to test 2049.75, and a fresh low is now being probed down to 2051.50. Again, its test isn’t required during a noN-bias environment, and exiting the bias environment back above 2057.00 would still be credible for launching an afternoon rally that the morning’ open was pushing