Posts by Rod David
Pre-close View… Back to business?
Afternoon bounce has corrected the morning drop.
The decline’s next lowe4r objective was to retest the October 2014 “V” bottom at 1815.00.
1815.00 was tested soon afternoon. Then it was probed down to 1804.25. And then 1815.00 was recovered coming out of the noon hour, recovering both the 1807.00 bias-down target AND the 1813.25 bias-down signal.
The no-bias environment allowed room up to the 1828.00 bias-up signal. No-bias trending probed it up to 1840.00. Now the 1828.00 bias-up signal has been retraced to within 3 ticks.
Was all of that done just to refresh sellers? Recall that the three-week long decline has yet to produce a capitulative session. Today’s gap and the morning’s extension down don’t qualify without also trending down this afternoon.
Back above 1842.00 could marginalize sellers for the balance of the day. Otherwise, another downleg could get underway to new lows — resuming the decline next targeting 1780.00 (+/- 3 points) and 1750.00.
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 weakness prevented closing above 1.0950, to maintain potential for reversing down to at least test 1.0750.
Gold Feb Contract (GC, ETF: (GLD))
Probing the two-week old prior high above 1109.00 didn’t extend higher, which would fulfill the outstanding third higher close that became required by confirming the two-week old breakout.
Silver Mar Contract (SI, ETF: (SLV))
Closing Wednesday above 14.10 could launch a new upleg by closing higher Thursday, too. The range otherwise persists.
30-year Treasury Mar Contract (US, ETF: (TLT))
Despite recovering intraday to probe the 161-09 overnight high by 9 ticks, the close was struggling to hold 160-12 as support whose break would all but seal a top.
Crude Oil Feb Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Extending down sharply Wednesday to test 26.20 now has room up to 27.40 before suggesting a corrective bounce may be underway. Coverage rolls forward to Mar as the front-month, which trades now at a 1.75 premium to Feb. Also, EIA reports irregularly on Thursday due to the holiday-shortened week.
Natural Gas Feb Contract (NG, ETF: (UNG, UNL))
Narrow sideways ranging at or under 2.14 doesn’t greet Thursday’s EIA report from a position of strength, but a knee-jerk reaction down would be capable of recovering.
Look ahead: Economic Calendar – for Thu Jan 21, 2016
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: Philly Fed is the only survey that has a track record of influencing price action. Reaction to it tends to be repeated by the day’s subsequent econ data, but there’s only the two EIA reports.
Jobless Claims
8:30 AM ET
*Philadelphia Fed Survey
8:30 AM ET
Bloomberg Consumer Comfort Index
9:45 AM ET
EIA Natural Gas Report
10:30 AM ET
EIA Petroleum Status Report
11:00 AM ET
10-Yr TIPS Auction
1:00 PM ET
Fed Balance Sheet
4:30 PM ET
Money Supply
4:30 PM ET
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Afternoon Bias
| WED afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 1835.50 | 1828.00 |
| …would target | 1842.50 | 1835.00 |
| Bias-down: under | 1820.75 | 1813.25 |
| …would target | 1814.25 | 1806.75 |
| Signal status: LATE NO-BIAS, TESTED BOTH BIAS–DOWN PARAMETERS | 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… Don’t even think about it.
Opening blip-up snaps back down into plunge.
Pre-open firming had been testing 1846.00 as resistance. Recovering it through the opening 15 minutes of volatility would have made bouncing into yesterday’s range likely.
Quickly reversing back under 1846.00 effectively shut that door.
Testing 1840.00 as support produced another blip-up, which peaked within 4 minutes instead of within 3 minutes. But its reversal down has extended to sharply lower lows attacking 1817.00. Every bounce limit has held its 3-minute test.
The next lower objective is now just 2 points lower, a retest of October 2014’s “V” bottom low at 1815.00. Its test isn’t necessary to produce a bounce — 1-minute RSI is diverging positively, and there’s a Running Correction that can be tested up to 1835.00-1836.00.
Bounce, or not, nothing requires 1815.00 to hold. And there is a not much support nearby below it.