Posts by Rod David
Post-open Review… Back to business?
Pre-open rally briefly probes positive territory.
Sunday night’s gap down and first-hour dip to 2609.50 was finally recovered to probe positive territory up to 2645.00. 
Before the open. Reacting down 14-16 points into the open had yet to correct. A post-open bounce tested 2639.00 — retracing 61.8% of the pre-open drop.
The bounce is normal. But delaying the correction until post-open often develops into a complete recovery. Today’s delayed 61.8% correction did hold, and did reverse down to attack the overnight low at 2609.75.
Despite stopping optimistically short of touching the overnight low, a bounce retested the bias-down signal up to 2639.50. And THEN resolved down. Fresh lows are now probing under Oct’s 2603.00 low to 2598.25.
The open’s delayed bounce was ineffectual pessimism, which is usually bullish from a contrarian perspective. The post-open low’s first bounce from only attacking the overnight low is ineffectual optimism — which has now resolved appropriately. Either the open’s bounce was an anomaly and a much bigger downleg is underway, or else October’s low is being retested to form a more durable bottom.
The First Trade & Pre-open Tour Recording… Isolation reversal setup, or else.
Proper context can start the day with a solid win and make all the difference.
DAILY SCHEDULE
First, watch the pre-open Tour recording HERE <<==
Then, meet in the chaRTroom here by 9:15 ET for updates and Q&A
Through the prior close…
Friday’s Employment Situation report was greeted in negative territory, but its reaction attacked Thursday’s 2699.00 closing high pre-open. A little post-open relief rally into positive territory was likely regardless of its resolution. Almost immediately attacking the 2711.00 bias-up target to within 5 ticks began reversing down almost immediately. And then relentlessly. The final hour was greeted 86-1/2 points lower attacking 2623.00. The final hour’s reaction stopped 4 points short of 2656.00 which could have signaled sellers were waning. Closing above 2626.00 (at 2633.50-2636.00) avoided signaling a new lower target is in-play.
Overnight action’s new info…
Sunday night’s Globex open gapped down to 2625.00, just above Friday’s low, then probed lower to attack 2610.00. Down 23-26 points, probing fresh low, all before the first hour had lapsed. That was also the low. Hovering in a narrow range up to 2621.00, and under Friday’s lows started breaking higher into Europe’s opens, first attacking and later testing 2632.00. Stopping pessimistically short of unchanged, still too early to be considered bullish from a contrarian perspective.
If, then… (notes to accompany the Tour recording)
Not formally putting into play the next lower objective (October’s 2603.00 low) didn’t equate to ending the decline, let alone to reversing the trend back up. Friday’s close was in the process of retesting Thanksgiving’s prior low, for which there already is no bullish reason. Its eventual break and a retest of 2603.00 is inevitable, but the path or paths aren’t yet set. Isolating last night’s probe under Friday’s range would suggest another detour has entered the path down, at least for this morning if not also through tomorrow morning. Meanwhile, the likelier template is that the decline is awaiting the intraday session — more likely, just its appearance over the horizon — before resuming.
First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 under 2625.25 would be likely to trigger the 2628.25 bias-down signal at 10:15. Exiting the open above 2635.50 would be unlikely to trigger bias-down.
Saturday Review’s recording (for 12/8/18) …Will next week live in infamy, too?
How does Monday’s gap up and Wednesday’s exacerbation catalyst still offer a chance of retracing last week’s drop before a bigger downleg develops? What does a bigger downleg look like, both in characteristic and degree? Which path is likelier, and what price action will be our clue?
These and other questions are answered, along with a bigger picture review of the market’s pattern, in this week’s Saturday Review. Also worth noting is the inclusion of several tenets underlying the philosophy of my analytical methodology.
Afterward, we held an impromptu introduction to the new Market Timing Knowledge Base, and specifically reviewed using inflection points for informing entry and exit decisions. Its recording is here.
The following stock requests were reviewed in this order:
ADBE, COST, JPM, WDC, GE, CAT
transcript
—————– (12/08/2018 09:31) —————–
Rod David: -=–=-
jp: gm
Rod David: Welcome to Saturday Review. Please post questions and comments as they occur to you.
David B: Good Morning
—————– (12/08/2018 09:51) —————–
ljr iPad: approx when does positive seasonality come in to play for dec?
—————– (12/08/2018 09:56) —————–
David B: What closing number for 2 consecutive sessions would tell us a bullish trend change?
—————– (12/08/2018 10:06) —————–
Mark G: likely Mon morning alternatives?
—————– (12/08/2018 10:11) —————–
ljr iPad: stocks: ADBE, COST, earnings after close thurs. thx
—————– (12/08/2018 10:17) —————–
ljr iPad: can u record that?
David B: JPM,WDC
—————– (12/08/2018 10:24) —————–
ljr iPad: thx
—————– (12/08/2018 10:25) —————–
David B: GE,CAT
—————– (12/08/2018 10:35) —————–
Mark G: thx much
David B: Thanks
Saturday Review 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 | 2643.75 | 2644.00 |
| …would target | 2655.75 | 2656.00 |
| Bias-down: under | 2627.75 | 2628.25 |
| …would target | 2617.25 | 2617.75 |
| 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.