Posts by Rod David
Look ahead: Economic Calendar – for Thu Mar 31, 2016
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: Maybe the monthly Challenger report and weekly Claims will be more influential ahead of Friday’s payrolls. At least, anything suggesting a weakening economy would be bullish for stocks, but the inverse isn’t necessarily true as fewer people believe a rate hike is coming. The Fed speaker will have spoken already Wednesday afternoon, so any knee-jerk reaction to his remarks should be temporary. The post-open PMI is always influential.
Challenger Job-Cut Report
7:30 AM ET
Jobless Claims
8:30 AM ET
Gallup Good Jobs Rate
8:30 AM ET
*Charles Evans Speaks
9:30 AM ET
*Chicago PMI
9:45 AM ET
Bloomberg Consumer Comfort Index
9:45 AM ET
EIA Natural Gas Report
10:30 AM ET
Fed Balance Sheet
4:30 PM ET
Money Supply
4:30 PM ET
Afternoon Bias
| WED afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 2070.50 | 2061.25 |
| …would target | 2076.50 | 2067.25 |
| Bias-down: under | 2060.25 | 2051.00 |
| …would target | 2053.75 | 2044.50 |
| Signal status: NO-BIAS | 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… Holding up, but holding out.
Probing fresh highs, if not actually extending.
Opening weakness touched the 2056.00 bias-up target as support and reacted back up to fresh highs at 2063.25. A reaction down to 2059.00 remained under pressure through 10:15, holding the 2061.25 renewed bias-up target.
This is still a bias-up environment. A renewed bias-up environment whose target was exceeded through 10:15.
Exceeding the 2061.25 renewed bias-up target through 10:15 would have put into play 2067.00-2068.00, but that was avoided. Also avoided was a break back under the 2056.00 bias-up target. And neither was exceeded by 10:30, which doesn’t suggest any sponsorship is available for trending.
A buy signal would trigger above 2062.50 (being tested now) targeting 2067.00-2068.00, and under 2059.75 would target 2054.25. Trending to either this morning would be vulnerable to reversing sharply. Not trending this morning would be likely to trend this afternoon.
Pre-market Tour (recording & summary)
The 2056.00 bias-up target was attacked to within 1 tick while reacting down from testing the 2061.25 renewed bias-up target. Neither of which is predictive without knowing how their tests will have resolved at 10:15. But the overnight rally should resume without much delay if it intends to extend intraday. Similarly, the bias-up target and its 2051.00 bias-up signal should be challenged early if the upside traction is inverting.
Details and other markets coverage are discussed in the pre-market Tour recording here.
The First Trade… Big shoes to fill.
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…
Tuesday’s opening 15 minutes of volatility elapsed entirely under Monday’s 2022.00-2023.00 lows. That’s an unstable base to launch a rally, and the bias environment exit didn’t recover the 2027.00 prior high. Yellen’s dovish remarks nevertheless triggered a surge back to Sunday night’s 2039.75 high. And that extended back to last week’s 2047.50 high.
Overnight action’s new info…
Extending even higher soon tested the next higher objective at 2051.00. A pullback to 2047.50 had been recovered into Europe’s opens, extending quickly up to 2058.25. Consolidating there for a couple of hours then broke higher again, testing 2061.50 before reacting down 3 points.
If, then…
The whole point to last week’s pullback was to correct the rally — specifically, its break above February’s highs — before resuming the rally to probe last year’s highs. The correction’s minimum objective was barely attacked to within 3 points Thursday at 2012.25. Its likelier objective at 1980.00 wasn’t even threatened. Yet, already new highs are printing for this year. That impatience left behind yesterday’s opening dip without actually absorbing or rejecting it, let alone retesting Thursday’s opening gap. Regardless of the sudden recovery’s degree, it’s still fresh, and still vulnerable. Its next higher objectives at 2051.00 and 2056.00 are also this morning’s bias-up signal and target, and their renewed bias-up target at 2061.25 is being tested. After expending a lot of impatient buying pressure overnight, what little traction was gained by yesterday afternoon’s buyers is at risk of inverting down. If 2061.25‘s test isn’t the start of this leg’s end, then doubly-renewing the bias-up would target 2067.00-2068.00.
First Trade…
Exiting the open at 9:45 under 2054.00 would be unlikely also to exceed the 2056.00 bias-up target or to renew the bias-up signal. Exiting the open above 2059.25 would be likely to renew the bias-up.