Posts by Rod David
Post-market Wrap (recording & summary)
Monday’s open gapped up considerably to 1932.00 and soon trended sharply higher to 1943.00. Still being governed by the bullish WedEX signal, a reaction down could not gain traction. And the reaction down to 1936.00 did not gain traction, instead recovering to a fresh session high at 1943.75.
Now a reaction down can gain traction. Not just trending down, but gapping back down under lower prior highs like 1923.00-1927.00 to form an Island. Otherwise, just dipping into their test would be attracted back up to Monday’s 1932.00 opening gap.
Overbought RSIs at Monday’s 1943.75 high require a retest, too. That can be neutralized overnight, although any complexity would require probing fresh highs intraday, whether only to 1946.00 or to 1952.00-1953.00.
Details and other markets coverage are discussed in the post-market Wrap recording here.
Monitor overnight Globex trading in the chaRTroom here.
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))
Monday’s open exploited the pattern’s vulnerability to plunging by gapping down after having trended down overnight. Gaps are leaving “unfinished business above” outstanding, and inihbiting the decline from extending much first..
Gold Apr Contract (GC, ETF: (GLD))
Falling Sunday night back under 1222.50 without recovering Monday is signaling the rally’s momentum has lapsed. Closing under 1216.50, too, would likely target 1195.00. Closing back above 1222.50 would resume the rally to 1942.00 and 1949.
Silver Mar Contract (SI, ETF: (SLV))
Gapping down Monday keeps alive potential for recovering to rtest last week’s high around 15.25.
30-year Treasury Mar Contract (US, ETF: (TLT))
Only a suspicious shallow dip accompanied stock futures soaring overnight. The weakness is suspicious because it almost qualifies as relative outperformance NOT during a filght-to quality.
Crude Oil Apr Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Overnight strength depesited Monday’s open more than $2 higher. It did not extend any higher intraday, which shouldn’t be productive anyway if a retst of the lows remains in-play.
Natural Gas Mar Contract (NG, ETF: (UNG, UNL))
.No new strength Monday prevented the pattern from trending.At least another morning would be required.
Pre-close View… Hanging by a thread.
Almost no upside attraction outstanding.
Simultaneously overbought RSIs at this morning’s 1943.00 high required a retest. The bias environment probed it by 3 ticks.
That was a no-bias environment, and probing above its 1941.00 bias-up signal was doomed to failure. Often, the 1:20 bias timing print is retraced, too. And it was, at 1939.00, and lower back down to 1936.00.
Breaking under 1936.00 would have room down to 1927.00 and 1923.00. Otherwise, back above 1938.50 would start to signal a retest underway of session highs like 1946.00 and potentially 1952.00-1953.00.
Having probed January’s high, a top can now begin forming. I would still expect today’s gap up to be retested from below, eventually — either before a durable decline can begin, or on the way to sharply higher highs.
Look ahead: Economic Calendar – for Tue Feb 23, 2016
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: Tuesday’s Consumer Confidence report is reliable for influencing price action. The post-open housing sector report could be influential if it contradicts the pre-open housing report’s implications, or confirms an earlier surprise.
Redbook
8:55 AM ET
S&P Case-Shiller HPI
9:00 AM ET
*Consumer Confidence
10:00 AM ET
*Existing Home Sales
10:00 AM ET
Richmond Fed Manufacturing Index
10:00 AM ET
State Street Investor Confidence Index
10:00 AM ET
4-Week Bill Auction
11:30 AM ET
2-Yr Note Auction
1:00 PM ET
Afternoon Bias
| MON afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 1944.25 | 1941.00 |
| …would target | 1949.00 | 1946.00 |
| Bias-down: under | 1937.50 | 1934.50 |
| …would target | 1931.25 | 1928.00 |
| Signal status: NO-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.