Posts by Rod David
Pre-market Tour (recording & summary)
Deja vu… The recovery from probing fresh lows overnight made it back up to 2059.50. That’s above the 2057.00 line in the sand for compartmentalizing the overnight probe of fresh lows. It’s also resistance, and it has pushed back to attack 2053.00.
Seems familiar. Yesterday’s overnight rally had deposited Thursday’s open at resistance whose recovery would have been bullish — only for post-open action to steal away the opportunity.
If there’s a bullish difference today, it’s that the push back has come pre-open, more pessimistic compared to yesterday. But that doesn’t lessen the requirement for a bullish scenario to quickly recover 2057.00, or at least to quickly reject a post-open dip.
Details and other markets coverage are discussed in the pre-market Tour recording here.
The First Trade… Overnight ‘tude.
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…
Wednesday night’s rally offered Thursday’s open an opportunity to trigger a bullish setup. Thursday’s open declined, figuratively and then literally. By only attacking 2070.00 instead of recovering it, the entire morning trended down until printing 2048.50 at noon. Rallying through the bias environment’s exit reached 2066.50 to setup another bullish opportunity. But the final hour slid back down to Wednesday’s 2057.50 lows. Overbought and oversold RSIs were left outstanding at either extreme.
Overnight action’s new info…
Firming never gained traction, and Thursday’s final hour slide soon resumed. Ranging narrowly at 2051.50-2053.50 broke to fresh lows down to 2046.25 into and out of Europe’s opens. A couple of big bounces have tried recovering the 2051.50-2053.50 range, which is now being retested.
If, then…
Last night’s lows pierced the upper-end of last Friday’s range. It was only momentary, although prior to Tuesday’s rally that would have been enough to break its support. That premise will likely be tested, along with Friday’s 2045.00 “lower prior highs,” if the overnight lows aren’t compartmentalized. Still, opening above yesterday’s lows may not be enough to reverse momentum up without also trending up quickly. Regardless of the direction, this is not a very comfortable area for the market, so it’s likely to try trending away from it — aggressively, if up — instead of ranging narrowly.
First Trade…
Exiting the open at 9:45 above 2057.00 would be unlikely to trigger the 2055.25 bias-down signal at 10:15, and under 2051.50 would be likely to trigger it. Exiting the open under 2046.00 would be likely also to exceed the 2049.75 bias-down target at 10:15 to renew the bias-down signal.
Morning Bias
| FRI morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2070.25 | 2065.75 |
| …would target | 2077.00 | 2072.25 |
| Bias-down: under | 2060.00 | 2055.25 |
| …would target | 2054.25 | 2049.75 |
| Signal status: noN-BIAS, TESTED BIAS-DOWN 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’s final hour didn’t resume the session-long decline. But neither did it extend the afternoon bias environment’s rally. And it missed an opportunity for the afternoon’s rally to gain traction. The bias environment was exited above the noon hour’s high, but the final hour wasn’t entered above the bias environment’s 2064.00 high — and that’s despite having probed higher to 2066.50 during the interim half-hour.
The final hour fell back down to 2057.50, essentially unchanged vs. Wednesday’s close. Having failed to gain traction, resuming the rally without delay Friday requires gapping up above Wednesday afternoon’s 2066.50 high. Its simultaneously overbought RSIs require a retest, but so does oversold RSIs at the 2048.50 low.
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… Will it, or won’t it?
Will today finish as bearishly as it could have been bullish?
Failing to trigger a formed setup can resolve as bearishly as it would have been bullish (or vice versa). A session-long rally had formed this morning without actually exceeding its 2070.00 trigger through the open. 
So, instead of probing each prior timing window’s high, each prior timing window’s low can be probed.
Regardless, the setup has one exception. It’s usually the noon hour, but today it is the afternoon bias environment. Probing its 2051.25 low need not touch the noon hour’s 2048.50 low.
It’s interesting to know what the afternoon bias environment was doing instead of trending down. This morning’s no-bias trending under its 2058.00 bias-down signal required being retraced. Its 2064.00 10:15 print is often retraced, too, and it was.
Maybe now is a good time to repeat the criticism of this morning’s bullish session-long rally setup. While its 2070.00 trigger had been tested thoroughly pre-open, post-open only attacked it to within 1 tick. Rejecting a post-open test of 2070.00 would be more reliable.
Back under 2059.50 would signal momentum reversing down, potentially under 2051.25. Oversold RSIs at the 2048.50 low require its eventual retest. But entering the final hour above the bias environment’s 2064.00 high (being probed now) would give buyers traction, and we could get an intraday print above 2070.00 after all.