Posts by Rod David
Look ahead: Economic Calendar – for Wed Nov 18, 2015
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: Wednesday’s econ reports are relatively high-profile, but also have no track record for influencing price action. The two Fed speakers are high-profile, with some track record for influencing price action. But the FOMC Minutes is highly-reliable for influencing price action..
MBA Mortgage Applications
7:00 AM ET
*William Dudley Speaks
7:30 AM ET
Housing Starts
8:30 AM ET
Atlanta Fed Business Inflation Expectations
10:00 AM ET
EIA Petroleum Status Report
10:30 AM ET
*Rob Kaplan Speaks
12:00 PM ET
**FOMC Minutes
2:00 PM ET
Afternoon Bias
| TUE afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 2066.50 | 2062.50 |
| …would target | 2072.00 | 2068.00 |
| Bias-down: under | 2060.00 | 2056.00 |
| …would target | 2054.50 | 2050.50 |
| Signal status: LATE 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… Going into extra rounds.
Pre-open Fibonaccis pick a winner, so the loser can win, too.
The pre-open retracement of 61.8% back to the 2059.25 high held as resistance. Its reaction down to 2045.50 filled the gap back to yesterday’s close. But it didn’t gain traction.
Ranging around the 2050.00 bias-up signal was overlapping at 10:15 to invoke the grace period. Its recovery through 10:30 triggered late bias-up.
The 2055.75 bias-up target was fulfilled almost immediately. It wasn’t exceeded in time to renew the bias-up signal, but that didn’t change whether this is a bias-up environment. It is.
And, renewed bias or not, the next higher objective is 2068.00. Already, fresh highs have touched 2060.50. Traction gained by yesterday’s rally suggests the trending will persist for another 20-30 minutes — making pullback limit tests likely to hold.
Regardless, exiting the bias environment back under its 2055.75 bias-up target would make higher highs unlikely before another corrective dip.
Pre-market Tour (recording & summary)
It’s not quite “Alien vs. Predator,” but Fibonacci vs. Fibonacci can be as exciting to a market technician. The overnight rally to 2059.52 formed a Head & Shoulders that reached its 161.8% extension. That reigned in some of the rally’s optimism, which could be bullish from a contrarian perspective. But its reaction up already retraced 61.8% back to the overnight high, which is a normal correction, and potentially bearish from the same contrarian perspective. Exciting! The battle lines have been drawn at 2053.50 and 2058.00, and probing either one further than its first 3 minutes would be likely to extend in that direction.
Details and other markets coverage are discussed in the pre-market Tour recording here:
https://roddavid10.mitel-nhwc.com/join/fbkmhvr
The First Trade… Just reward.
Proper context can start the day with a solid win and make all the difference.
CHARTROOM LINK(s)
o Win XP-Friendly entry
o non-xp friendly (ilinc)
(pre-open Market Tour begins at 8:55 ET)
Through the prior close…
Sunday night’s gap down had been recovered into positive territory before Monday’s open, a pre-open dip was recovered to higher highs. The morning’s bias environment contained one last correction, before marginalizing sellers for the balance of the session. The afternoon’s 31-point upleg up to 2051.00 gained traction.
Overnight action’s new info…
Flat-to-higher ranging had dipped into Europe’s opens. But that only launched another upleg to 2059.25. It was preceded by a dip down to 2055.00, and followed by a reaction down to 2055.00. That formed a Head & Shoulders which is now probing lower under 2054.00.
If, then…
A reward is due for gaining traction. That’s usually delivered by the next morning extending the trend. But when last-hour and/or overnight timing windows have already extended the trend, the risk is that fully-rewarded buyers become sellers. And that risk is greeting today’s open. An overnight pullback to 2035.00 would have helped to secure a morning rally. Yesterday afternoon’s 2041.25 renewed bias-up target was being met as the bias environment began lapsing. It was extended 10 more points into the close, and now at least 8 more points overnight to 2059.25. That’s 30 points since yesterday afternoon’s 2029.00 buy signal. None of which is a sell signal, and this upleg still has room to 2068.00. A pre-open pullback could suffice in place of an overnight pullback. Otherwise, not extending higher immediately post-open would be vulnerable to inverting back down.
First Trade…
Exiting the open at 9:45 above 2058.00 would be likely also to exceed the 2055.75 bias-up target at 10:15 to renew the bias-up signal. Exiting the open under 2051.00 would be unlikely to renew bias-up. Exiting the open under 2048.00 would be unlikely to trigger the 2050.00 bias-up signal.