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))
Thursday’s gap down rejected Wednesday’s gap up to the range’s upper-end, and suggests that momentum isn’t reversing up. A break under the 4-day range should be imminent.
Gold Jun Contract (GC, ETF: (GLD))
Gapping down Thursday under 1271.50 and probing lower didn’t prevent a retest of Wednesday’s high. The 1282.70 bounce limit held again, and attacking it was reversed to attack the open’s low, while still ranging around 1271.50. The 1241.00 target remains intact.
Silver Jul Contract (SI, ETF: (SLV))
Immediately probing under 17.30 Thursday extended down to test natural support at 17.05, keeping alive the drop to fresh lows still targeting at least 16.75.
30-year Treasury Jun Contract (US, ETF: (TLT))
Gapping down Thursday and extending lower held a test of the 165-00 pullback limit. Also creating unfinished business above back to Wednesday’s close should help to attract price higher and resume the rally targeting 166-30 and 167-26.
Crude Oil Jun Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Gapping up Thursday to 46.60 and extending to 47.00 pierced prior highs, but reversed back into negative territory by noon. The reversal didn’t extend, and was retraced to retest 46.60, essentially fulfilling the outstanding third higher close outstanding requirement.
Natural Gas Jun Contract (NG, ETF: (UNG, UNL))
Greeting Thursday’s EIA report from a position of strength didn’t prevent a knee-jerk reaction down. But holding 2.14 and closing above 2.18 is the minimal bullish template.
Mid-day Update… The consequences continue.
Predictable and productive trending remains intact.
This morning’s 2052.50 bias-down target was still being overlapped at the bias environment exit. A retracement to its 2058.00 bias-down signal is required. Often, the 10:15 bias timing window print is also retraced at 2064.00.
First things, first. Oversold RSIs at the 2048.50 low require its retest. That didn’t prevent bouncing to 2056.50, but now 2052.50 is being tested as support.
Also being tested is a sell signal at 2051.50. Not triggering it would make a higher bounce likelier. The bigger challenge is that this morning’s potentially bullish setup (session-long rally) had formed but wasn’t triggered, which should point down shrprly today.
Look ahead: Economic Calendar – for Fri May 13, 2016
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: Friday’s reports include a pre-open and post-open release that are each reliable for influencing price action. Any reaction to the pre-open report is likely to be duplicated by the post-open report.
Retail Sales
8:30 AM ET
*PPI-FD
8:30 AM ET
Business Inventories
10:00 AM ET
*Consumer Sentiment
10:00 AM ET
*Baker-Hughes Rig Count
1:00 PM ET
John Williams Speaks
6:45 PM ET
Afternoon Bias
| THU afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 2060.75 | 2056.00 |
| …would target | 2065.75 | 2061.00 |
| Bias-down: under | 2054.50 | 2049.75 |
| …would target | 2050.25 | 2045.50 |
| Signal status: NO-BIAS, TESTED BOTH BIAS SIGNALS, REJECTED | 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… Consequences of a failed attempt.
Failed bullish setup becomes bearish.
A bullish “session-long rally” setup would have formed from gapping up above yesterday afternoon’s 2070.00-2071.00 bias environment high. The setup didn’t formed, but it didn’t trigger.
Not for lack of trying — the retracement was tested for more than 3 hours before the open. It was even probed to almost 2073.00. But 2070.00 was only attacked to within 1 tick post-open.
That’s worse. The consequences of failing to trigger a formed setup are equivalent to its lost reward. And a session-long rally would have trended up throughout the day. So, with the exception of one timing window –usually the noon hour — today’s session is likely to trend down.
Meanwhile, this morning’s 2067.50 bias-up signal held as resistance through 10:15, putting into play an offsetting test of the 2058.00 bias-down signal. This now being tested to within 3 ticks, so it won’t become “unfinished business” if left outstanding. But exiting the bias environment any lower would all but require retesting last Friday’s lows.