Posts by Rod David
Morning Bias
| THU morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2473.25 | 2474.25 |
| …would target | 2483.50 | 2484.25 |
| Bias-down: under | 2453.75 | 2454.25 |
| …would target | 2447.75 | 2448.25 |
| Signal status: BIAS-DOWN, BIAS-DOWN TARGET EXCEEDED | . | |
| BIAS VIDEOS… INTRO // EXAMPLE | ||
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.
Market Wrap (recording & summary)
There’s no unfinished business below.
- Monday’s low had fulfilled the decline’s next lower objectives at 2361.00 and 2345.00.
- Tuesday night’s opening plunge testing 2317.00 didn’t qualify as being a “new Globex trend extreme” requiring intraday retest, due to the singular nature of its leg, and its later retest holding the noise range.
- Wednesday’s post-open surge to 2387.00 reacted down and filled the gap back to Monday’s 2352.00 cash session close, neutralizing its attraction.
- Holding tests of both morning bias-up parameters overcame the rejection by entering the noon hour above its 2372.50 bias-up target.
Two intraday behaviors signaled that buyers were stronger-handed than sellers:
- Monday’s 2352.00 cash session close held a test through Wednesday’s post-open dip, and another before the bias environment began lapsing.
- Printing fresh session highs during the afternoon bias environment wasn’t reversed back under a prior low before entering the final hour.
Does Wednesday’s 161-point rally from Tuesday night’s low already reward buyers for absorbing sellers? Too much, too soon, to extend higher immediately? Regardless of the upside vulnerability that facilitated it, Wednesday’s last intraday upleg is no different in principle than Sunday night or Tuesday night’s opening plunges which created extremes. And Wednesday is the first session gain for the decline beginning Dec 13, day-9 of what may be an Up/Down-Crash setup that would be timed to resolve this week.
Closing positive Thursday would at least invalidate the Up/Down-Crash setup. But this bounce has room up to 2525.00 and 2607.00 without yet qualifying as more than a temporary correction. I’m still reluctant to pronounce a bottom forming without there first being a capitulative session. Or, two — and Wednesday’s rally doesn’t limit this week’s vulnerability to that.
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))
Gapping down Wednesday was recovered at least to fill the gap back to Monday’s 1.1500 close, but reversing down slid to fresh lows, testing a last sleeper support under 1.1430.
Gold Feb Contract (GC, ETF: (GLD))
Gapping up Wednesday and extending to fresh highs above 1282.00 was retraced to test unchanged at 1272.50. Holding its test would keep alive upside momentum.
Silver Mar Contract (SI, ETF: (SLV))
Wednesday’s open compensated for the larger delay in extending higher by gapping up above all ~14.90 prior highs and trending up sharply to 15.25.
30-year Treasury Mar Contract (US, ETF: (TLT))
Fresh highs overnight retested Thursday’s 146-00 high before it became clear there was no near-term need for a flight-to-safety. A deeper retracement formed Wednesday morning after gapping down and sliding to 144-26. Closing any lower would suggest a top is forming.
Crude Oil Feb Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
While no bottom can be durable at this stage of the patter, Wednesday’s gap up extended sharply higher through the morning to test Friday’s 42.65 higher prior lows. Regardless of the bounce, Thursday’s EIA report is not being greeted from a position of strength.
Natural Gas Jan Contract (NG, ETF: (UNG, UNL))
Overnight lows fulfilled the 3.33 target before bouncing Wednesday into positive territory testing 3.58. Thursday’s EIA report is not being greeted from a position of strength.
Mid-day Update… Stretching the rubber band.
lede .
This morning’s no-bias environment had triggered after the open’s surge to 2387.00 failed to hold both of the 2361.00-2372.50 bias-up parameters through 10:15. The morning’s low at 2345.50 was the second test of Monday’s 2351.00 low. Neither test broke any lower or for any longer. The offsetting tests of both bias-down parameters wasn’t fulfilled.
This morning’s offsetting tests of both bias-down parameters was rendered moot, anyway, by exiting the bias environment above its bias-up target. It wasn’t a clean exit, lasting from 11:30-noon. And the open’s high wasn’t recovered until the final possible minutes. So, I’m not convinced the upside if durable.
Durable or not, the upside has been strong. The noon hour’s 2415.00 high reacted down to 2394.00, and triggered late bias-up 2 points higher. Having already met the 2409.00 bias-up target, sell signals would be credible if triggered. The bias-up target is being retested now.
Back under 2396.00 would offer one more chance to reverse the trend back down, whether into this morning’s lows or lower. Extending higher would have no particular target at this time.
Look ahead: Economic Calendar – for Thu Dec 27, 2018
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: Thursday is, as usual, the week’s busiest. Two housing sector reports offer an opportunity for surprise by them potentially contradicting each other, or reinforcing an outlier. Meanwhile, any noticeable reaction to a pre-open report is likely to be duplicated by a post-open report.
MBA Mortgage Applications
7:00 AM ET
Jobless Claims
8:30 AM ET
FHFA House Price Index
9:00 AM ET
New Home Sales
10:00 AM ET
*Consumer Confidence
10:00 AM ET
EIA Natural Gas Report
10:30 AM ET
EIA Petroleum Status Report
11:00 AM ET
4-Week Bill Auction
11:30 AM ET
8-Week Bill Auction
11:30 AM ET
7-Yr Note Auction
1:00 PM ET
Farm Prices
3:00 PM ET
Fed Balance Sheet
4:30 PM ET
Money Supply
4:30 PM ET