Posts by Rod David
Morning Bias
| FRI morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2658.25 | 2662.50 |
| …would target | 2664.00 | 2668.25 |
| Bias-down: under | 2643.00 | 2647.00 |
| …would target | 2634.75 | 2638.75 |
| Signal status: BIAS-DOWN, BIAS-DOWN TARGET EXCEEDED | . | |
| 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)
Thursday’s session has the appearance of trending down. That’s understandable, being comprised of a series of lower lows and lower highs. The open’s quick surge up to 2675.00 was reversed down through the afternoon bias environment’s 2641.25 low. Trending, yes, but also an entire session of overlapping leg after overlapping leg.
Trend, or backing-and-filling? More so the latter, holding a test of the gap back down to Tuesday’s 2642.00 cash session close.
So, Thursday’s session isn’t very predictive. Except that filling Tuesday’s 2642.00 gap could be a dip too many — since two proxies for the gap at 2662.75 and 2655.00 were already tested, and influential. But any dip can still be recovered, so long as it’s not maintained through a relevant timing window.
A relevant timing window, like Thursday’s close. Which was struggling to hold 2655.00.
Immediately recovering 2662.50 through Friday’s open would be the next available signal that the decline from Wednesday morning’s 2690.50 high had ended. Its objective would be to resume the rally. Almost any delay in recovering would keep alive the vulnerability to retesting recent lows.
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 Dec Contract (EC, ETF: (FXE, UUP))
Only recovering to the 1.1370 buy signal Wednesday still required extending above it Thursday. Reacting down still recovered back up to 1.1370 — after filling the gap back down to Tuesday’s close. A bullish pattern should rally into the weekend.
Gold Feb Contract (GC, ETF: (GLD))
Ranging narrowly sideways throughout Thursday wasn’t necessarily bullish, but it continued to avoid a negative reaction to the recent break higher that has yet to extend..
Silver Mar Contract (SI, ETF: (SLV))
Wednesday’s session qualified as a breakout, but the second consecutive confirming session didn’t develop. The rally can extend anyway, but too deep of an interim pullback could launch a new downleg.
30-year Treasury Jan Contract (US, ETF: (TLT))
The 142-30 pullback limit had held Tuesday, and its 142-16 room for noise had held Wednesday. Firming overnight was reversed Thursday to probe another fresh low, which was recovered back above prior lows. A completed pullback would not delay rallying into the weekend.
Crude Oil Jan Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Wednesday night’s dip did hold up0n testing the range’s lower-end, but that doesn’t equate to being a bottom. Thursday’s intraday bounce stopped short of completing a bottom.
Natural Gas Jan Contract (NG, ETF: (UNG, UNL))
Already greeting Thrusday’s EIA report from a position of weakness, fresh lows were probed intraday Thursday. Rallying through the reaction must still recover 4.44 (again) to suggest the pattern is resolving up.
Mid-day Update… Last chance for gas?
Fresh lows not gaining traction.
This morning’s bias-up signal became invalidated, and fell to its 2650.50 bias-down signal. That seems like sellers are patient. They did produce fresh lows into the noon hour that met this afternoon’s 2642.00 bias-down target to within 3 ticks.
But now this afternoon’s bias-down signal has avoided triggering. And the noN-bias environment doesn’t prevent rallying above the bias-down signal.
noN-bias doesn’t require the 2651.25 bias-up signal to define the window’s upper-end. In fact, it was probed by 8 points. The likely upside objective is still 2662.50, but it doesn’t require being met. And the decline may resume.
Exiting the bias environment (or entering the final hour) above 2662.50 would suggest that sellers from yesterday’s high are done. Meanwhile, breaking under 2642.00 would simply point down.
Look ahead: Economic Calendar – for Fri Dec 14, 2018
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: Only the post-open PMI is reliably influential to price action, but it’s not particularly high-profile. Retail sales is high-profile, but not very influential. Any noticeable reaction to a pre-open report will likely be duplicated in reaction to a post-open report.
Retail Sales
8:30 AM ET
Industrial Production
9:15 AM ET
*PMI Composite FLASH
9:45 AM ET
Business Inventories
10:00 AM ET
Baker-Hughes Rig Count
1:00 PM ET