Posts by Rod David
The First Trade… Remember that “V” bottom?
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…
Gapping up and extending higher Wednesday attacked 1877.00 during the morning bias environment’s surge. Crude Oil had inspired that move, despite having put new lows into play. Both returned their gains, and matched their steep surges as fresh session lows were probed. Selling did not extend until the latest opportunity, not optimal but still credible for gaining traction to fulfill its 1848.00 potential down to 1843.50. No unfinished business above was left outstanding.
Overnight action’s new info…
There was barely any hesitation in extending down to 1832.00 well before midnight. But ranging back up to 1840.00 didn’t break until Europe’s opens. And it broke lower, sharply, first to 1809.00 which was consolidated up to 1817.00. A spike down to 1802.50 snapped back up quickly to 1818.50.
If, then…
Breaking under the morning’s lows so late yesterday had prevented the move from signaling the decline has resumed. Yet, a 44-point overnight slide just retested the 3-week old 1805.00 lows. Extending down overnight sharply and relentlessly to whatever degree is more difficult to extend post-open. By the same token, extending that overnight drop post-open — under a relevant support and through a relevant timing window — can produce a multiple of the overnight slide.
First Trade…
Exiting the open at 9:45 through 1807.00 would be unlikely to extend down this morning, whether by absorbing a retest of the low or simply by rallying back up to the 1834.50 bias-down target — with potential up 1850.00. Not recovering by 9:45 from probing back under 1807.00 would be likelier to trend down through the morning.
Morning Bias
| THU morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 1855.75 | 1850.25 |
| …would target | 1861.75 | 1856.50 |
| Bias-down: under | 1845.50 | 184o.25 |
| …would target | 1840.00 | 1834.50 |
| Signal status: waiting for trigger | 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)
Th 3:10-3:20 window did what the bias environment exit and final hour entry did not. It came alive with an aggressive dive to new lows. It was the least optimal timing, so the least reliable. But it did prevent being range-bound and firming. And its reward was to fill the gap back down to yesterday’s 1848.00 close down to 1845.50.
Details and other markets coverage are discussed in the post-market Wrap recording here.
Monitor overnight Globex trading in the chaRTroom here.
Error!
Unfortunately, I cannot get the remote machine to launch the Anymeeting software. I’ll get it running this evening, and I apologize for the issue.
Pre-close View… Range-bound means rally.
At least, it would look that way within such a wide range.
Exiting the bias environment probing the open’s 1855.50 low had an excellent opportunity to dive much deeper. Signals had triggered already from the prior bounce to 1866.00. The rally could have been largely retraced (but probably not reversed).
But bouncing into and out of the noon hour attacked 1872.00. And that’s just a corrective bounce, still well off of the morning’ 1877.75 high. Such is the power of wide ranges.
Now, another dip attacking 1856.00 is stopping short of extending down. Stopping short as much in terms of price, as in terms of time. Entering the final hour under prior lows would have been bearish. Trying, and failing, is not.
Not bearish doesn’t equal bullish. But the balance of the session can attack the upper-end of just this afternoon’s range and still be a substantial rally-like bounce. In fact, the latest reaction up is already attacking 1865.00.
It’s too late to signal a substantial resumption of the recovery. And resuming the decline should be obvious through 3:10-3:20 if it’s in-play.