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 Dec Contract (EC, ETF: (FXE, UUP))
Wednesday’s probe of fresh highs wasn’t likely to extend, but Thursday’s gap down under last week’s 1.0985 prior high hasn’t yet proved momentum is reversing down. A correction can fill the week’s two lower outstanding gaps below and then resume the rally. Retesting Wednesday’s high first would make the next downleg more durable.
Gold Feb Contract (GC, ETF: (GLD))
Gapping down Thursday back under 1074.00 support didn’t extend down, keeping the window open for a break above 1077.70 to extend higher intraday.
Silver Mar Contract (SI, ETF: (SLV))
Still hovering at or above the rally attempt’s original 14.10 target still makes a break above 14.35 likely to extend sharply higher intraday.
30-year Treasury Jan Contract (US, ETF: (TLT))
Hovering Thursday just under Wednesday’s highs maintains the upside momentum that still targets a fresh high at 156-12.
Crude Oil Jan Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
After having neutralized the attraction at Monday’s gap down, hovering narrowly just off recent lows all but ensures probing fresh lows down to 36.25. Recovering to close positive the same day would suggest a bottom had formed.
Natural Gas Jan Contract (NG, ETF: (UNG, UNL))
Thursday’s EIA report was not being greeted from a position of strength. But also not from a position of weakness, which didn’t prevent trending down gently in reaction to the news. An immediate reversal from this setup would not be credible.
Mid-day Update… Will lightning strike twice?
Morning rally’s retracement still has a margin of comfort.
This morning’s 2046.50 bias-up target was put back into play by the late bias-up signal. Its test was likely to visit 2048.00, which it did, on the way to 2054.25.
As quickly as the bias signal probed higher, it has taken four times as long to retrace back down to this morning’s 2040.75 bias-up signal. And there’s no assurance of reversing back down through it.
There’s still time — time, and recent volatility — to retest yesterday’s ~2027.00 lows down to 2022.50 and still recover. But closing today under 2040.00 would confirm yesterday’s simultaneous break under both it and 2052.00 (2048 and 2060 basis Dec). Closing today above 2052.00 would end the recent decline.
Look ahead: Economic Calendar – for Fri Dec 11, 2015
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: Friday’s PPI is already high-profile and infulential to price action, but releasing it simulteneously with Retail Sales can create either contradiction, or reinforce a surprise. Reaction to the post-open Consumer Sentiment should duplicate any reaction to the pre-open reports.
*PPI-FD
8:30 AM ET
Retail Sales
8:30 AM ET
Business Inventories
10:00 AM ET
*Consumer Sentiment
10:00 AM ET
Baker-Hughes Rig Count
1:00 PM ET
Afternoon Bias
| THU afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 2058.00 | 2048.75 |
| …would target | 2065.00 | 2055.75 |
| Bias-down: under | 2049.25 | 2040.00 |
| …would target | 2044.25 | 2035.00 |
| Signal status: noN-BIAS, TESTED BIAS-UP SIGNAL | 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 up the down staircase.
Retesting overnight highs.
The 2046.50 bias-up target had been met already overnight. Its reaction down had touched 2036.00 pre-open. And then post-open, too. Its latter test launched a retest of 2046.50 to within 1 tick.
The bias-up target’s retest also reacted down to 2036.00. But the 2040.75 bias-up signal was overlapped within 3 minutes of 10:15 to invoke the grace period at 10:30.
And the grace period triggered “late bias-up.”
A more thorough test of 2046.50 is likely, probably up to 2048.00. None of which changes the likely retest of yesterday’s ~2027.00 low, whose path was always suspect. That attraction can still be neutralized, initially by exiting this morning’s bias environment above 2046.50.