Posts by Rod David
Post-market Wrap (recording & summary)
PLEASE REPORT BACK TO ME IF YOU NOTICE ANY AUDIO/VIDEO ABNORMALITIES ON THE WRAP VIDEO.
Anxiousness often paralyzes the market on the afternoon prior to a monthly Employment Situation report. Thursday was no different, despite triggering the bias-up signal. Its bias-up target was tested twice before falling 15-16 points back down to the open. No sponsorship gained traction.
That included the decline back under the bias-up signal during a bias-up environment. Typically this is weak-handed sponsorship, since no traction will be gained for the effort. In fact, it was retraced entirely. That’s potentially bullish from a contrarian perspective, especially ahead of weighty event like Friday’s pre-open report.
But the late-afternoon recovery only neutralized its attraction above. No prior high was recovered to reverse momentum up. Not recovering a break lower would likely extend back to Wednesday’s lows — and being a Friday, potentially much lower.
Details and other markets coverage are discussed in the post-market Wrap recording here.
When the intraday room lapses, monitor overnight Globex trading in the chaRTroom here.
Pre-close View… Corrective dip in a corrective bounce.
Bias-up environment’s support failed.
The noon hour probed repeatedly above the 1909.25 bias-up signal. Its 1914.00 bias-up target was met by 1:20. It was met again after a dip back down to the bias-up signal.
Being a bias-up environment whose target was already met, trending higher would be more difficult, but not impossible. Not until another dip back to the bias-up signal’s support.
Some support. Despite being likely to define the range’s lower-end, it broken lower. Its break extended to 1899.50 during the bias-environment. It extended a little deeper a little later.
Often, trending away from the likely influences is compensated by a surge in the original direction So, any upside traction could produce fresh afternoon highs. Trending down isn’t likely ahead of tomorrow’s report.
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))
Wednesday’s out-sized strength didn’t prevent gapping up again Thursday and extending even higher to confirm the breakout. At least an eventual third higher close is now likely.
Gold Feb Contract (GC, ETF: (GLD))
Gapping up Thursday didn’t trend much higher intraday, nor did it give back the opening gain, forming a potential Island. Gapping down back into Wednesday’s range — preferably under 1138.00 — would form the pattern, which would be likely to be retested.
Silver Mar Contract (SI, ETF: (SLV))
Thursday’s higher high tested 14.91 resistance without closing above it, so no higher targets are in-play. But momentum remains intact since the pullback limit held its test of 14.86.
30-year Treasury Mar Contract (US, ETF: (TLT))
Overnight weakness tested the 161-27 sell signal into Thursday’s open and firmed from there to continue ranging around the rally’s 162-26 target.
Crude Oil Mar Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Testing the 29.42 pullback limit by 2 cents snapped back to gap up Thursday, and a post-open dip also snapped up to 33.60. But the 32.50 bounce limit held through the close as was expected.
Natural Gas Mar Contract (NG, ETF: (UNG, UNL))
Greeting Thursday’s EIA report from a position of weakness allowed fresh lows for the move to form at 1.95. The pattern still has no buy signal, and its fresh low close doesn’t make a durable recovery yet likely.
Look ahead: Economic Calendar – for Fri Feb 5, 2016
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: Friday’s pre-open payrolls report for is high-profile and has a reliable track record for influencing price action. It is released this time in a vacuum with no other relevant reports nearby. So, its initial reaction will be extra vulnerable to reversing through the open.
Loretta Mester Speaks
THU 5:00 PM ET
*Employment Situation
8:30 AM ET
International Trade
8:30 AM ET
*Baker-Hughes Rig Count
1:00 PM ET
Consumer Credit
3:00 PM ET
Treasury STRIPS
3:00 PM ET
Afternoon Bias
| THU afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 1915.50 | 1909.25 |
| …would target | 1920.00 | 1914.00 |
| Bias-down: under | 1902.00 | 1896.00 |
| …would target | 1897.00 | 1890.75 |
| Signal status: BIAS-UP, BIAS-UP TARGET MET | 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.