Posts by Rod David
Pre-market Tour (recording & summary)
Knee-jerk reaction to the pre-open Employment Situation report blipped-up a couple of points to 2046.25. Ranging there for several minutes ultimately resolved down 2039.25, and its reaction has resolved down to 2036.50.
Avoiding 2032.00 could depend upon opening above 2039.25, and trending up through the morning could depend upon exiting the open above 2044.50. Otherwise, 2032.00 could be the last line of defense against trending down relentlessly into the afternoon.
Details and other markets coverage are discussed in the pre-market Tour recording here.
The First Trade… Flushed out, or flushing?
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…
Eking higher through the morning had attacked 2060.00 when the noon hour began. The next two timing windows were spent sliding to attack overnight lows within 6 ticks at 2048.75. The final hour’s bounce only attacked 2056.00 instead of recovering it, still undermining the rally’s momentum.
Overnight action’s new info…
Choppy ranging eventually touched 2056.00, which was rejected abruptly. Sliding into and out of Europe’s opens reached 2042.25. A 7-point bounce resolved down to momentarily touch 2041.25, quickly settling in to range narrowly around 2044.50.
If, then…
Including last night’s slide, three relatively substantial downlegs have developed since Wednesday morning’s attack on 2065.00. There is a fine line between temporary correction and momentum reversal, especially ahead of a high-profile influential econ report like this morning’s monthly payrolls. The pullback is vulnerable to becoming a trend reversal if not already ended by the open. While 2044.50‘s test would suffice for completing a pullback, it has room for noise down to 2039.25. The next lower objective at 2032.00 could be a last line of defense before reinstating 1980.00. All of which could become moot by a favorable reaction that opens back within yesterday’s range.
First Trade…
No preliminary levels are considered prior to an Employment Situation report.
Morning Bias
| FRI morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2071.50 | 2062.00 |
| …would target | 2077.25 | 2068.00 |
| Bias-down: under | 2058.00 | 2048.75 |
| …would target | 2052.00 | 2042.50 |
| Signal status: LATE BIAS-DOWN, BIAS-DOWN TARGET MET | 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)
The decline from 2059.50 touched 2048.75 as Thursday’s bias environment was being exited under the noon hour’s low. But the final hour’s entry was still overlapping the bias environment’s 2050.50 low. So, sellers gained no traction for the substantial effort.
At least they prevented closing above 2056.00, despite having probed above it for a second consecutive day. But the close was also maintained above its 2051.00 counterpart, a small victory for buyers.
Without gaining traction, trending Friday must begin by gapping beyond a prior relevant high or low. Lacking the basis for a “session-long” decline or rally setup, trending through the morning would be vulnerable to reversing. The next higher attraction above is 2067.00-2068.00, and below is 2044.50 and 2039.25.
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… Saving the best for last.
Noon hour slide attracts sellers.
Flt-to-higher choppy ranging eked gradually higher this morning. Recovering from its pre-open dip to 2053.00 had extended to 2059.50 at noon.
Sliding since then has been relentless, trending down to fresh session lows at 2049.00.
The slide’s purpose could have been similar to yesterday’s, expending a lot of selling pressure without it gaining traction for the effort. But today’s slide is threatening to enter the final hour under the 2050.50 bias environment low, after exiting the bias environment under the noon hour lows.
Sellers may be gaining traction into Friday’s Employment Situation report.
Extending back down to the 2047.25 overnight low would likely give way to 2044.50, and potentially also to 2039.25. If sellers do gain traction, then overdoing it already could risk inverting the traction back up, and might be the only way to end the week rallying.