Posts by Rod David
The First Trade… Steady as she goes.
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…
Tuesday morning’s rally developed after the open had held the 1950.50 biias-up signal. The no-bias trending was invalidated by exiting the bias environment above the 1955.50 bias-up target. That tends to reflect serious intent, and a mid-day running correction resolved by surging up to 1973.00. Buyer had gained traction already before the close softened to 1967.25.
Overnight action’s new info…
Dipping initially to 1962.75 was recovered 10 points to within 1 tick of yesterday’s 1973.00 high. Another dip attacking 1964.00 is now recovering back to 1970.00.
If, then…
Gaining traction is usually rewarded by trending the next morning, or after being delayed until the afternoon, in either case targeting 1977.00 and 1185.00. The overnight ranging keeps alive the potential for a post-open rally. Expiration’s influences are keeping things lively, and a morning pullback could attack yesterday’s 1957.50 noon hour low. That would have to be done early to maintain its potential for being only a detour, and not a deeper drop targeting 1950.50 or lower.
First Trade…
Exiting the open at 9:45 under 1964.00 would be likely to trigger the 1966.50 bias-down signal. Already under 1957.50 at 9:45 would be likely also to exceed the 1959.75 bias-down target at 10:15 to renew the bias-down signal. Exiting the open above 1970.00 would be unlikely to trigger bias-down.
Morning Bias
| WED morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 1982.50 | 1972.00 |
| …would target | 1987.25 | 1977.00 |
| Bias-down: under | 1976.75 | 1966.50 |
| …would target | 1970.25 | 1959.75 |
| Signal status: NOn-BIAS, TESTED BIAS-UP SIGNAL | FAQ | |
| INTRO VIDEOS #1 and #2 | ||
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.
Post-market Wrap… Still some breadcrumbs on the table.
Tuesday’s buyers gained traction for their efforts — the bias environment was exited at 2:30 above the noon hour’s range, and the final hour was entered above the bias environment’s range. That tends to be rewarded by trending higher through the following morning.
That said, that’s not how a similar template was rewarded last Tuesday. Its afternoon bias environment was exited above its bias-up target despite being a no-bias environment. which is what happened this Tuesday morning. Last week’s situation might have been exacerbated by trending up already overnight. Similar action in this setup would target 1977.00 and 1985.00.
Backing-and-filling overnight down to 1964.00 would still be likely to resolve up Wednesday. And if not recovering into a morning rally, then an afternoon rally would be likely, still targeting 1977.00 and 1985.00. Looming ahead is the WedEX indicator and Thursday’s impending FOMC statement. Details and other markets coverage were discussed during the post-market Tour recorded here:
https://roddavid10.mitel-nhwc.com/join/xmmsmmj
After 6:30pm ET, use these links to monitor overnight Globex trading:
XP-Friendly || non-xp ilinc
Pre-close View… Bucking the trend change.
The morning surged. Not throughout the bias environment, but the surge held up. The bias environment was exited with a last blip-down to 1956.00, which recovered up to 1962.00 during the noon hour. That formed a running correction.
Surging into a running correction is one thing. Surging into a running correction and then surging out of it is another. Those there stages are often followed by a fourth stage that plateaus.
Despite triggering its 1962.00 bias-up signal, this afternoon’s bias environment formed a plateau, while fulfilling its 1969.25 bias-up target. That’s four stages, and the fifth stage is very reliable for trending.
In which direction is a different matter.
Entering the noon hour above 1970.00 would suggest the plateau had given way to another rally leg. Back under 1966.75 would be likelier to retrace the running correction, or lower.
Probing 1970.00 10 minutes before the final hour osprobing 6 ticks above the plateau. It gets every benefit of the doubt. But back under 1966.75 would signal momentum reversing down instead.
Daily Spot… Bonds better be a buy.
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))
Monday didn’t really exploit its opportunity to back-and-fill after Thursday’s confirmed breakout. Tuesday exploited the opportunity just a little more.
Gold Dec Contract (GC, ETF: (GLD))
Reacting down from attacking 1111.00 resistance Tuesday now creates a credible base for launching a durable rally leg, but the setup won’t tolerate much delay before resuming the decline instead.
Silver Dec Contract (SI, ETF: (SLV))
Tuesday’s narrow ranging around 14.35 was unnecessary since its attraction below was neutralized already, but not necessarily bearish so long as rallying becomes obvious Wednesday without much further delay.
30-year Treasury Dec Contract (US, ETF: (TLT))
Unfinished business below at 153-12 was satisfied by Tuesday’s drop, which first reacted up from fulfilling the objective and then broke another point under it to 152-19. Holding 152-30 as resistance would allow the break to extend down to 151-30.
Crude Oil Oct Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Still avoiding a rally leg Tuesday is more relevant to the pattern than not yet extending down sharply, which the pattern is vulnerable to doing at any time.
Natural Gas Oct Contract (NG, ETF: (UNG, UNL))
Probing a few cents higher overnight was retraced before Tuesday’s open, when a second consecutive higher close above 2.77 would confirm Monday’s breakout.