Posts by Rod David
Morning Bias
| THU morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2098.50 | 2092.75 |
| …would target | 2104.75 | 2099.00 |
| Bias-down: under | 2089.50 | 2083.75 |
| …would target | 2081.75 | 2076.00 |
| Signal status: NO-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.
Pre-close View… One more for a gapper.
Maintaining fresh highs could form a hold-long setup.
The FOMC news was a knee-jerk reaction down to 2077.50. Originating between 2081.75-2083.75 made the reaction either way likely to be false. In fact, its reversal recovered 2081.75-2083.75 to signal momentum reversing up. Follow-through extended to 2090.25.
Retracing down to 2083.75 still exited the bias environment above the noon hour’s high. The final hour wasn’t entered higher, but trending up to fresh highs through 3:10-3:20 would confirm the rally is gaining traction.
The rally is at least trying to resume. Fresh highs are being probed up to 2092.25. Potential to 2110.00 remains alive, but just closing above 2095.00 would signal the rally has resumed.
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))
Wednesday’s FOMC reaction probed above Tuesday’s test of 1.1345 resistance before reversing down more substantially, filling the nearest gap, and likely targeting fresh lows.
Gold Jun Contract (GC, ETF: (GLD))
Gapping up Wednesday to and through 1248.00 probed above 1251.00 intraday. A knee-jerk reaction to FOMC touched what had been the 1241.00 bounce limit. Back under 1241.00 would reinstate the decline targeting 1222.00.
Silver May Contract (SI, ETF: (SLV))
Gapping up Wednesday was retraced to fill the gap back down to Tuesday’s close. Bouncing again was retraced in reaction to the FOMC news. Any new rally effort would be credible for resuming the rally.
30-year Treasury Jun Contract (US, ETF: (TLT))
Despite being an appropriate area for a low, Wednesday’s gap up was the wrong tactic for launching a durable recovery. The FOMC reaction’s blip-up touched the 162-14 buy signal and held it, still needing to fill the gap back down to Tuesday’s 161-04 close.
Crude Oil Jun Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Probing fresh highs overnight was reversed down on Wednesday’s morning’s EIA report, but only to fill the gap back to Tuesday’s close. The afternoon was recovered entirely and probed fresh highs. The sell signal has been raised to 43.90.
Natural Gas Jun Contract (NG, ETF: (UNG, UNL))
Holding Tuesday’s test of 2.14 “lower prior highs” is free to launch a recovery, but Wednesday’s open did not start it. There was no second consecutive lower close to confirm Tuesday’s breakout.
Mid-day Update… Waiting for it.
Is FOMC news the trigger?
Trending isn’t likely ahead of the 2:00pm FOMC policy statement. That didn’t prevent bouncing more than 9 points into the noon hour’s 2085.75 high. This morning’s 2075.50 bias-down target was met to within 3 ticks, and the bias environment exit recovered its 2081.00 bias-down signal.
The only unfinished business below is oversold RSIs at 2076.25. Its test would be targeted under 2079.00. Greeting the FOMC news there wouldn’t be healthy. Fresh lows at 2067.00-2069.00 would be targeted, and potentially lower if not recovered quickly.
Back above 2083.75-2085.00 would greet the FOMC news from a position of strength, allowing a favorable reaction to expend less energy just to retrace resistance, leaving more energy to rally. Fresh highs at 2110.00 remain likely.
P.S. Somehow the last post’s chart was incorrect. Click here for the correct chart.
Look ahead: Economic Calendar – for Thu Apr 28, 2016
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: The post-open PMI flash is Thursday’s only report with a track record for influencing price action. GDP is only high-profile. But to the degree there is any pre-open responds to news, it should be duplicated by post-open news, too.
BOJ monetary policy statement
GDP
8:30 AM ET
Jobless Claims
8:30 AM ET
Bloomberg Consumer Comfort Index
9:45 AM ET
*PMI Services Flash
9:45 AM ET
EIA Natural Gas Report
10:30 AM ET
Kansas City Fed Manufacturing Index
11:00 AM ET
2-Yr FRN Note Auction
11:30 AM ET
7-Yr Note Auction
1:00 PM ET
Fed Balance Sheet
4:30 PM ET
Money Supply
4:30 PM ET