Posts by Rod David
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))
Gapping up Tuesday held 1.9050 resistance whose recovery would launch a new rally leg. It reacted down to attack 1.090, whose break would resume the decline.
Gold Feb Contract (GC, ETF: (GLD))
Fresh highs Tuesday touched the 1131.50 target and reversed back down into negative territory. No second consecutive higher close confirmed higher targets are in-play. But the trend hasn’t reversed down, and closing only slightly lower Tuesday requires closing under 1114.00 to launch a new downleg.
Silver Mar Contract (SI, ETF: (SLV))
Monday’s test of 14.35-14.40 resistance wasn’t rejected then, and wasn’t rejected Tuesday, but still hasn’t extended higher to launch a new rally leg.
30-year Treasury Mar Contract (US, ETF: (TLT))
The 162-26 target was met early Tuesday, which now allows room down to 160-16 before starting to signal the trend reversing down — probably sharply.
Crude Oil Mar Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Monday’s gap down under the 32.50 pullback limit wasn’t recovered at Tuesday’s open, probing lower lows down to 29.80. A bounce could test 31.65 while still maintaining the downside momentum.
Natural Gas Mar Contract (NG, ETF: (UNG, UNL))
Monday’s reaction down had been required by Friday’s gap up. Extending down deeper overnight was not required, let alone extending under the recent range’s prior lows. This is not a pattern that recovers durably, even if it tries recovering immediately.
Mid-day Update… Not soft, if not a landing.
Bouncing from fresh session lows.
This morning’s range was essentially centered around 1904.50. A late recovery effort twice tested 1911.00, but collapsed to new lows at noon. Its drop to 1896.75 has been retraced to 1904.50.
That’s beyond optimal for maintaining the decline’s momentum. So, resuming the decline should be aggressive and pretty soon. Otherwise, bouncing any higher could isolate the probe under this morning’s lows, while reversing momentum up.
Bottoming here could bounce to 1913.00 and 1924.00. Lower lows would likely test “lower prior highs” just under 1890.00. Extending under 1886.00 could soon test 1869.00. .
Look ahead: Economic Calendar – for Wed Feb 3, 2016
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: It’s the week for monthly payrolls, so several other jobs reports are released. The most influential among them is Wednesday’s ADP. Being pre-open, any reaction to it would be likely to repeat if either post-open report were to trigger a reaction, too.
MBA Mortgage Applications
7:00 AM ET
*ADP Employment Report
8:15 AM ET
Gallup U.S. Job Creation Index
8:30 AM ET
PMI Services Index
9:45 AM ET
ISM Non-Mfg Index
10:00 AM ET
EIA Petroleum Status Report
10:30 AM ET
Afternoon Bias
| TUE afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 1920.00 | 1913.00 |
| …would target | 1925.25 | 1918.25 |
| Bias-down: under | 1908.50 | 1901.50 |
| …would target | 1902.50 | 1895.50 |
| Signal status: BIAS-DOWN | 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… Back so soon.
Probing into last week’s range below.
The open’s make-or-break seems to have broken. A narrow pre-open consolidation quickly extended down under 1911.00 to test 1904.50. That broke lower to 1901.25, a little short of its potential to the 1900.00 area.
Back above 1905.50 could begin a corrective bounce up to 1911.00 and 1915.00. Otherwise, the 1900.00 area could be probed down to 1886.00 before signaling a much bigger decline underway.
And a much bigger decline would be to probe under last week’s lows, resuming the prior downleg. Testing 1900.00 and 1886.00 can be avoided by a bigger bounce. But the bigger bounce must be productive going into the noon hour to be credible.