Posts by Rod David
Pre-close View… Expiration’s over.
It’s time to see what this market intends without that influence.
This afternoon’s 1954.50 bias-down signal triggered. Actually, it was already probed during the noon hour. And not by a little. Its 1948.75 bias-down target was probed down to 1944.25.
Before Friday’s open, we were keying off of that area to determine whether the overnight plunge was done. (It was.) Both tests launched bounces. Today’s bounce to 1957.00 probed above the bias-down signal during the bias-down environment.
Groundwork has been laid to avoid resuming the decline. The noon hour’s low filled the gap back to Friday’s 1946.00 cash session close which neutralized its attraction below. Two buy signals triggered during its reaction up to 1957.00. The bias environment retested this afternoon’s 1948.75 bias-down target as support.
Now the bias environment is lapsing. Back under this afternoon’s 1948.75 bias-down target could undo the groundwork laid by the recovery attempt. Otherwise, back above 1954.50 and preferably also above 1957.00 could target fresh session highs above 1969.00 today.
Note the Falling Wedge / running correction that preceded the low, plunging into and out of it. We’ll be discussing it during the post-market Wrap…
Daily Spot… Weekend reactions.
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 Sep Contract (EC, ETF: (FXE, UUP))
Friday’s reaction down to the upper-end of the 1.1275-1.1345 range extended down overnight to gap down Monday at the range’s lower-end. Extending lower intraday tested 1.1200, so that back above 1.1275 would now resume the rally. There is otherwise no active sell signal.
Gold Dec Contract (GC, ETF: (GLD))
The reaction down from having fulfilled the 1141.50 target tested 1129.40 Sunday night, which must hold to maintain the rally’s momentum. Back above 1138.70 would resume the rally.
Silver Dec Contract (SI, ETF: (SLV))
The 15.10 pullback limit held another shallow test Sunday night. Back above 15.33 would resume the rally.
30-year Treasury Dec Contract (US, ETF: (TLT))
Friday’s steep rally to 155-24 resistance reacted down into Monday’s gap down at 155-00 that trended down intraday to test 153-28. Back above 154-14 would resume the rally. Otherwise, the correction could extend next down to test 152-30.
Crude Oil Oct Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Rallying Sunday night back to 46.00 resistance wasn’t rejected Monday, so Friday’s break lower wasn’t confirmed, but the rally’s resumption is not signaled without also recovering 46.60.
Natural Gas Oct Contract (NG, ETF: (UNG, UNL))
Gapping down Sunday night and extending lower into Monday’s open prevents a buy setup from triggering without first retesting Monday’s 2.55 opening gap from above 2.61 “higher prior lows.”
Mid-day Update… Not exactly “easy come.”
Bullish WedEX lapses in a big way.
The overnight rally to 1964.25 was substantial, but nothing pre-open could be attributed to the potential bullish WedEX signal. Post-open action did probe the overnight high, and Friday morning’s high, eventually trending steeply to 1969.00. That fulfilled the bullish WedEX.
WedEX applies only to Friday afternoon and Monday morning — nothing before, and nothing after. The latter part was made obvious by a plunge at 11:30 that probed fresh post-open lows. In fact, natural support at Friday’s 1946.00 cash session close is being filled now (down to 1944.25).
What caused the about-face — Russia just announcing an unexploded shell landed in its Damascus embassy Sunday, or simply Europe’s closing and the USD dipping? Whatever, it’s too late for rejecting it through the noon hour’s exit, so a bottoming effort is needed before a buy signal can be identified.
Afternoon Bias
| MON afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 1972.25 | 1961.25 |
| …would target | 1978.50 | 1967.50 |
| Bias-down: under | 1965.50 | 1954.50 |
| …would target | 1959.75 | 1948.75 |
| Signal status: BIAS-DOWN, BIAS-DOWN TARGET MET | 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… Hanging on for dear life.
Pre-open pullback holds, but not yet reversed.
Like the iconic 1980’s poster, this morning’s post-open action seems to be trying not to let go after climbing up to a high limb.
The pre-open pullback from 1964.25 had touched this morning’s 1956.25 bias-up signal as support. A post-open blip-down extended 2 more points momentarily. But that was recovered to the 1962.75 bias-up target. Which held.
Its reaction down threatened the bias-up signal but bias-up triggered. So, this is a bias-up environment whose target has been met.
Exceeding the 1962.75 bias-up target through 10:30 would have renewed the bias-up signal. It’s too late for that, and already having touched the bias-up target, the balance of the morning usually only ranges sideways.
Usually. Usually, the balance of the morning isn’t potentially influenced by an aggressively bullish WedEX. So, I won’t be considering a sell signal, and until disproved, I’ll assume the rally is extending higher before noon.