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))
Gapping up Tuesday tested 1.090 resistance, but didn’t signal the trend reversing up. Initial strength Wednesday would be credible for resuming the rally, but the pullback targeting 1.0750-1.0785 otherwise remains in-play.
Gold Feb Contract (GC, ETF: (GLD))
Gapping down Tuesday followed Monday’s close at or above 1074.00, which was the least reliable confirmation of Friday’s recovery being durable. Closing above 1077.70 would have been optimal, so recovering to close above it Tuesday, or extending immediately above it Wednesday, would be likely to extend sharply higher intraday.
Silver Mar Contract (SI, ETF: (SLV))
Gapping down sharply Tuesday to test 14.10 support left outstanding a gap above back up to Monday’s close. Filling it and extending above 14.35 would be likely to trend in that direction intraday.
30-year Treasury Jan Contract (US, ETF: (TLT))
Early strength Tuesday barely filled the gap back to Thursday’s 155-30 close before reacting down sharply intraday to 154-22. But the bounce remains likely to test 156-12 so long as 154-14 holds as support.
Crude Oil Jan Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Gapping down Tuesday was reversed back into positive territory, trying to avoid a second consecutive lower close that would have confirmed Monday’s breakout from a multi-session range. The session struggled at unchanged, not quite confirming the breakout, but not a reliable rejection either.
Natural Gas Jan Contract (NG, ETF: (UNG, UNL))
Fresh lows overnight at 2.01 weren’t retested post-open Tuesday, but the session struggled in negative territory to essentially confirm Monday’s breakout from a multi-session range, and to require at least a third eventual lower close before a recovery would be credible.
Look ahead: Economic Calendar – for Wed Dec 9, 2015
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: Wednesday’s econ reports have no track record of influencing price action.
MBA Mortgage Applications
7:00 AM ET
Wholesale Trade
10:00 AM ET
EIA Petroleum Status Report
10:30 AM ET
10-Yr Note Auction
1:00 PM ET
Mid-day Update… Laying low.
Big recovery attempt stops short of gaining traction.
As the open’s volatility warned, this morning’s price action would not trend. The opening hour’s fluctuation touched 2062.00 at its high, before reversing back down to fresh lows at 2050.25. Despite surging up to 2073.25, the noon hour was entered back at 2062.00.
So, potential down to 2048.00 remains alive — not in-play at the moment. But dipping back into the open’s range would all but ensure probing a fresh low, presumably down to 2048.00.
Resuming the rally and triggering this afternoon’s bias-up signal still wouldn’t invalidate the potential downside. But the potential downside remains a vulnerability otherwise.
Afternoon Bias
| TUE afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 2072.25 | 2071.00 |
| …would target | 2078.25 | 2077.00 |
| Bias-down: under | 2061.00 | 2059.25 |
| …would target | 2057.75 | 2053.50 |
| Signal status: LATE NO-BIAS, TESTED BIAS-DOWN 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… Dragging it out.
Rally window is closed for now.
The bullish template was disqualified when the open delayed rallying, and instead extended down. A bearish template didn’t fill the void, not without the opening 15 minutes of volatility being exited under the opening print, which it was not.
That alone warns us of a choppy morning ahead, if not a choppy session. And this is regardless of there being an objective in-play, like the potential for choppy ranging to visit 2048.00 at some point.
Exiting the bias environment above 2060.00 would start to undermine sellers. There is otherwise much greater potential to probe fresh lows.