Posts by Rod David
Saturday Review recording (for 12/15/18) …Mind the gap.
Trending down to greet the weekend at recent lows isn’t in itself bearish. But that defines yesterday’s trend and its result. Bearish would be the panoply of characteristics to the downtrending, combined with this being the third test of a critical price level. And bearish would be the potential for resolving down aggressively without further delay.
This week’s Saturday Review describes the bigger picture that led here and which defines this price level’s relevance, along with the possibility of a counter-trend bounce. (Friday’s Market Wrap discusses that session’s setups and signals.)
Watch Friday’s post-market Wrap recording here.
CLICK HERE TO WATCH SATURDAY REVIEW
The following stock requests were reviewed in this order (the last 8 are from this week’s Barron’s article Top 10 Stock Picks for 2019):
WDC, MU, FDX, ROKU, NKE, ALLY, GOOG, AAPL, BAC, BLK, CAT, DDAIF, DAL, ET
transcript
—————– (12/15/2018 09:33) —————–
Rod David: Welcome to Saturday Review. Please post questions and comments as they occur to you.
David B: Good Morning
Bill G: gm
Mark G: gm
—————– (12/15/2018 09:49) —————–
jp: gm
—————– (12/15/2018 10:02) —————–
Mark G: extending down to low 2500 atbthis stage would unlikly recover to 2600 any time soon?
—————– (12/15/2018 10:05) —————–
David B: Does the spread between the cash and futures narrower or wider mean anything?
—————– (12/15/2018 10:09) —————–
David B: options expiration week is one of the wild cards this week with the fed and possible goverment shutdown?
Bill G: You consider any rally from here to be just temporary?
—————– (12/15/2018 10:12) —————–
Bill G: Perhaps a Xmas rally into early Jan?
—————– (12/15/2018 10:13) —————–
David B: what happens if no rate cut or he walks back next year?
—————– (12/15/2018 10:18) —————–
David B: WDC
—————– (12/15/2018 10:19) —————–
lloyd: MU, FDX – earnings thurs after close
David B: is ROKU a january candidate?
lloyd: (sorry TUES after close)
lloyd: NKE – earnings thurs after close. thanks
lloyd: i will watch recording.
—————– (12/15/2018 10:28) —————–
Adam: Was there a market wrap last night?
—————– (12/15/2018 10:32) —————–
David B: it seems like this is a market where rallies are being sold. Is there something that will tell us if it starts to be market on buy the dips?
David B: Yes
—————– (12/15/2018 10:37) —————–
David B: will we know strong or weak buyers?
—————– (12/15/2018 10:41) —————–
Mark G: thx much
David B: AMAT
Bill G: That’s the 2018 list
—————– (12/15/2018 10:43) —————–
Bill G: y
—————– (12/15/2018 10:56) —————–
Bill G: The guy who made that list only looked at the first seven letters in the alphabet?
David B: Thanks
Bill G: Thanks
Saturday Review Link – NEW LINK
Be sure to join us by 9:30am ET for this weekend’s Saturday Review. After discussing the bigger picture and gaming out strategies for playing next week’s likelier opening setups, we’ll do instant analysis of any stock charts that you request… See you there!
Morning Bias
| MON morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2602.50 | 2606.50 |
| …would target | 2612.50 | 2616.50 |
| Bias-down: under | 2589.75 | 2593.75 |
| …would target | 2582.00 | 2586.00 |
| Signal status: BIAS-DOWN, BIAS-DOWN TARGET MET | . | |
| NEW: 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)
Friday’s gap down held Tuesday’s ~2626.00 low through the open and bounced. Friday’s mid-morning low held a retest of Tuesday’s low by 3 points, and bounced again. Not only one, but two tests of a relevant support, and both tests holding. Usually on Fridays, the “try, try again” setup only traps its sponsorship into a bigger bounce through the close.
Except that Friday’s second test of Tuesday’s low failed before the bias environment lapsed. Sellers were the stronger-handed. Two noon hour opportunities to prove otherwise — which Friday Factors always allow — weren’t exploited as the balance of the session trended back down to prior lows attacking 2597.00.
A hold-short was compelling, other than it being over a weekend and not just during daily maintenance. The bigger picture discussion in this weekend’s Saturday Review defines the risk and potential reward.
Details and other markets coverage are discussed in the post-market Wrap recording 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 Dec Contract (EC, ETF: (FXE, UUP))
Thursday’s dip had filled the gap back down to Tuesday’s close, preserving the pattern’s opportunity to extend through its 1.1370 buy signal. The alternative would be to retrace the entire pattern back down to its 1.1285 low, which is where Friday’s gap down opened. A rally would still be credible, but only if begun without delay coming out of the weekend.
Gold Feb Contract (GC, ETF: (GLD))
Friday’s gap down to 1237.00-1240.00 was as much selling pressure as would be appropriate for a temporary pullback before resuming the rally. But not immediately rejecting that deep of a dip is essentially signaling the rally’s momentum has lapsed, if not already reversing down.
Silver Mar Contract (SI, ETF: (SLV))
Uptrending support coincided Friday at 14.70, and gapping down under it extended to fill the gap back down to Tuesday’s 14.60 close. That gap was created while filling the prior session’s gap, so there isn’t any bullish reason for its retest. Any further delay to resuming the rally would be bearish.
30-year Treasury Jan Contract (US, ETF: (TLT))
Thursday’s close was too deep to maintain the rally’s momentum, which had been hanging on only by default. Immediately recovery 143-08 Friday would have reinstated it, but the session only ranged flat-to-higher. There is no active signal.
Crude Oil Jan Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Friday continued fluctuating in the basing pattern without breaking higher into the weekend, and likely at least to blip-down and stretch the rubber band before snapping back up into a rally.
Natural Gas Jan Contract (NG, ETF: (UNG, UNL))
Greeting Thursday’s EIA report from a position of weakness absorbed its gap up, which was reversed back down to uneven. The reversal extended down overnight and gapped open to fresh lows Friday attacking 3.80. There is no active signal.