Posts by Rod David
Saturday Review Link
This week began with one of the year’s biggest trades. It ended with a perfect example of timing windows and bias parameters identifying a significant extreme. Those are just two of this week’s lessons we’ll review this weekend.
Be sure to join us by 9:30am ET for this weekend’s Saturday Review. After discussing the bigger picture and gaming out strategies for playing next week’s likelier opening setups, we’ll do instant analysis of any stock charts that you request… See you there!
Morning Bias
| MON morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2095.25 | 2089.25 |
| …would target | 2102.25 | 2096.25 |
| Bias-down: under | 2086.25 | 2080.25 |
| …would target | 2077.50 | 2071.50 |
| Signal status: BIAS-DOWN | 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)
This morning’s plunge was recovered throughout the afternoon. But it stopped short of touching Thursday afternoon’s highs. Pessimistically short. And that’s potentially bullish from a contrarian perspective. Unfinished business above left outstanding at 2092.00 can attract Monday’s open and extend it into a probe of fresh highs that tests 2110.00. Meanwhile, delaying an upleg would be attracted down to Friday’s oversold RSIs at 2075.00, and potentially lower to 2067.00.
Details and other markets coverage are discussed in the post-market Wrap recording here.
Your link to the Saturday Review will be sent overnight.
Pre-close View… Mmmm, pudding!
Growing proof that the drop was weak-handed.
Only 2 errant ticks pierced this morning’s 2075.50 bias-down target. That’s less relevant than the fact that it held through 11:30. Having originated during a no-bias environment, its 2081.75 bias-down signal required retracement. This “no-bias trending” would have been invalidated if 2075.50 had not held.
2081.75 was retested, along with the 2092.00 10:15 print that is also often retested after no-bias trending. Which leaves one more objective outstanding, this morning’s offsetting test of its 2092.00 bias-up signal.
There’s still risk of reversing down. Oversold RSIs at the 2075.00 low require its eventual retest, but with any particular timing. And this afternoon’s rally leg was launched from a Symmetrical Triangle, a pattern that often breaks falsely in one direction before reversing more substantially in the opposite direction.
But momentum is currently pointed up. The afternoon’s rally has been consolidating just under yesterday’s late afternoon highs, pessimism that is potentially bullish from a contrarian perspective. Especially if the 3:10-3:20 timing window were to trend higher, the balance of the session should extend higher, too.
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))
Friday’s slide finally produced a fresh low close that fulfills the unfinished business of the recent confirmed breakout. Monday mornings tend to duplicate Fridays in currencies, so lower lows are likely. Closing under 1.1170 would signal a much deeper decline underway.
Gold Jun Contract (GC, ETF: (GLD))
Sliding through the 1248.00 sell signal Friday morning probed under 1230.00, presumably on the way to fulfilling the 1222.00 objective below. It remains in-play so long as 1234.50 is not recovered.
Silver May Contract (SI, ETF: (SLV))
Choppy ranging Friday consolidated Thursday’s steep intraday reversal back to Tuesday’s 16.88 lows, while ignoring Gold’s plunge, presumably preparing to resume its rally targeting 18.80.
30-year Treasury Jun Contract (US, ETF: (TLT))
Flat narrow ranging Friday avoided producing the eventual third lower close that has become required by Wednesday’s confirmed breakout. Bounces should meanwhile hold any test of 163-12.
Crude Oil Jun Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Wednesday’s high had probed recent highs, and closed slightly higher. Probing Wednesday’s high Friday without closing above it suggests that topping has begun — but not yet sealed. Waning upside momentum was indicated separately by Friday’s session “ineffectual optimism” that gapped up and spent the entire session in positive territory without maintaining the probe above Wednesday’s prior high. Closing above 43.55 keeps alive potential for resolving up, and under 43.10 would start to siganla break lower is underway.
Natural Gas May Contract (NG, ETF: (UNG, UNL))
Thursday’s relatively muted reaction to the day’s EIA report was resolved up to fresh highs Friday, targeting 2.20-2.25.