Posts by Rod David
Post-market Wrap (recording & summary)
Tuesday morning’s surprises weren’t surprising. We expected the 2041.50 bias-up signal to hold its test and trigger no-bias, and we expected its reaction down to hold a test of 2034.00-2035.00. Both were probed by a couple of points, but they held.
Tuesday afternoon’s lack of surprises was surprising. Invalidating the attractions below only extended higher, and did not reverse intraday direction again.
A late dip from 2058.50 pierced the noon hour’s range down to 2052.00. But it was too late for sellers to gain traction, and it was not aggressive as the pattern allows at this stage. So it’s possible that a new upleg is about to begin, and gapping up Wednesday would be credible for launching it.
Of course, we’re still in the ongoing trading range, which has repeatedly greeted each session with a different picture than was left at the prior close. Not already trending up at Wednesday’s open could find sellers back in control.
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… Stretching it thin.
Still rewarding the morning’s buyers.
Exiting this morning’s bias environment above its 2046.50 bias-up target had invalidated any downside objective put into play at 10:15. That doesn’t equate to a buy signal, but the recovery has extended anyway, up to 2058.50.
That’s 30 points above the low. And almost as many points since a reversal. RSIs have been deteriorating, and now a break lower is testing 2054.50. Any lower would target 2051.00 and potentially lower.
There’s otherwise no active pattern. The bias environment exit was AT the noon hour’s high, not above it and not exactly overlapping it. The final hour’s entry was higher, but that’s not enough on its own to reflect traction.
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 Mar Contract (EC, ETF: (FXE, UUP))
While Monday night’s fresh high proves that sellers aren’t exactly retaking control, not yet extending higher or reacting down sharply also reflects the current range’s attraction. Trending away from it the first time will likely retrace entirely.
Gold Apr Contract (GC, ETF: (GLD))
Probing higher overnight was largely retraced into Tuesday’s open, which then extended down to the 1253.00 pullback limit. Bouncing from there stopped just short of a second consecutive higher close, but the door open to retracing the recent breakout to 1244.00 and 1225.00. Extending higher anyway would target 1270.00 and potentially 1286.00.
Silver May Contract (SI, ETF: (SLV))
Extending higher Tuesday instead of rejecting Monday’s close above 15.88 has confirmed a breakout, requiring at least one more higher close, and targeting 16.30 or 16.85.
30-year Treasury Jun Contract (US, ETF: (TLT))
Monday’s test of the 165-12 pullback limit was retested down to its 165-11 low Tuesday morning. And then lower, targeting 164-12/164-20 until recovering back above Monday afternoon’s 166-16 high.
Crude Oil May Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Friday’s breakout and Monday’s confirmation weren’t optimal, but extended higher Tuesday anyway, filling the gap above at 42.00-42.35. It also fulfills the minimum third higher close of Friday’s confirmed breakout. The breakout and confirmation weren’t optimal, so the recovery remains vulnerable to reversing down quickly, and back under 41.90 would signal momentum reversing down.
Natural Gas May Contract (NG, ETF: (UNG, UNL))
Gapping up Tuesday to and through 1.95 helped to offset Monday’s gap down, and to confirm the pullbacks have been from positions of strength. But a second consecutive higher close would be helpful confirmation to finally launching the next upleg.
Look ahead: Economic Calendar – for Wed Apr 13, 2016
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: Wednesday’s afternoon’s Beige Book is reliable for both inhibiting and then triggering price action. The pre-open PPI also influences price action, and its reaction is often duplicated by other econ reports before and after the open. The mid-morning’s EIA report is likely to have an impact, too.
MBA Mortgage Applications
7:00 AM ET
Retail Sales
8:30 AM ET
*PPI-FD
8:30 AM ET
Business Inventories
10:00 AM ET
Atlanta Fed Business Inflation Expectations
10:00 AM ET
*EIA Petroleum Status Report
10:30 AM ET
10-Yr Note Auction
1:00 PM ET
*Beige Book
2:00 PM ET
Afternoon Bias
| TUE afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 2057.25 | 2050.50 |
| …would target | 2062.75 | 2056.25 |
| Bias-down: under | 2048.75 | 2042.25 |
| …would target | 2044.25 | 2037.50 |
| Signal status: noN-BIAS, TESTED BIAS-UP SIGNAL | 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.