Posts by Rod David
It just gets worse. The
It just gets worse. The 1919.50 overnight low”s reaction held its test of 1934 resistance, resolving down to fresh lows at 1914. That”s within the orbit of the very relevant 1911, with room for noise down to 1907. Testing and holding one or both through the open could form a durable bottom for this morning, launching a substantial bounce. Avoiding their test or breaking lower would find only temporary obligatory support on the way to new lows under 1831. … Details and other markets coverage were discussed during the pre-market Tour recorded here:
https://roddavid10.mitel-nhwc.com/join/mjzmcfr
It has taken a little
It has taken a little longer than I described last week during Livestox, but the plunging has resumed. There”s a small window during the open to test overnight lows and to hold them, perhaps clearing the way for a morning rally. But while possible, a bounce is not required, so be careful “knife-catching” if so inclined. And since the plunge into last week”s low largely avoided the Cannabis stocks, their turn may have come, so be confident in what you own and prepared for opportunities (although probably not today).
The First Trade… Raining AND pouring.
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 plunge to 1960.00 did a relatively small portion of what Friday had been vulnerable to throughout the day. Monday”s session was vulnerable to extending down further, but only attacked the overnight low. At least the entire session was spent in negative territory, and its sellers gained traction for their efforts.
Overnight action”s new info…
Empathizing with China crashing again helped to deliver the rest of what Friday had been vulnerable to — by dropping 31 points to test 1931.00. Consolidating there has broken lower to 1919.50, where a bounce is probing back above 1931.00.
If, then…
We discussed during yesterday”s post-market Wrap that seasonal bullishness surrounding Labor Day weekend all but required resuming the decline without delay, or else it would be delayed until next week. As powerful as the overnight plunge is, there is still a small window to reverse momentum back up. Just gapping down to 1938.00 would form a sort of Island from Thu-Mon price action. Not the sort of Island that requires being retested, but which resumes the prevailing trend. Room for noise under 1938.00 down to 1934.00 must both maintain their breaks through today”s open to maintain the overnight plunge”s momentum. Otherwise, momentum can be pointed back upward for the balance of the morning.
First Trade…
The market is far below this morning”s bias parameters.
Morning bias
| TUE morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 1978.25 | 1975.00 |
| …would target | 1984.00 | 1980.75 |
| Bias-down: under | 1965.25 | 1962.00 |
| …would target | 1957.25 | 1954.00 |
| Signal status: BIAS-DOWN, BIAS-DOWN TARGET EXCEEDED | 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.
Monday afternoon”s sellers gained traction
Monday afternoon”s sellers gained traction for their effort — the bias environment was exited at 2:30 under the noon hour”s low, and the final hour was entered under the bias environment”s low. Of course, that was the case at Thursday”s low, which immediately reversed back up to retrace all of a 42-point plunge. But the recovery didn”t extend any Friday, and if the setup is still influential, then Tuesday won”t rally, either.
That can be invalidated Tuesday”s open by immediately recovering Monday”s 1979 bias environment high, and maintaining it. That”s more than 11 points, not especially difficult in this environment. Which would be that much more bearish not to reject Monday afternoon”s sellers at Tuesday”s open.
Rejecting the downside would likely resume the corrective bounce, next targeting 1996-2000. Extending Monday”s decline would target 1953.50, and then 1944, and then much, much lower. Details and other markets coverage are discussed in the post-market Tour recording linked here:
https://roddavid10.mitel-nhwc.com/join/shwtphh
After 6:30 ET, use one of the following links to monitor the overnight Globex action:
Win XP-Friendly — http://anymeeting.com/831-529-426
non-xp friendly — https://roddavid10.mitel-nhwc.com/join/bfyytsh