Posts by Rod David
Post-open review… False negative.
Choppy, narrow open finally gives way. For a moment.
The pre-open reaction to this morning”s Employment Situation report had attacked 2071.00. Reacting up to touch the 2082.50 overnight high proved only temporary, and the open was greeted back under 2077.00. Soon 2071.00 was being attacked again.
That pre-open volatility proved deceptive. It had sucked out any post-open trending attempt. Volatility remained high, albeit in a narrower 5-point range centered around the 2073.00 bias-down signal — 6-7 swings around 2073.00.
The range ended, but apparently not the volatility.
The grace period triggered bias-down from under the open”s range. That tends to offset the signal having been triggered late. But despite extending down to 2067.25, a bounce is now probing back above 2073.00.
The late signal can be invalidated by exiting the bias environment at 11:30 back above the open”s range, which is 2077.00 or better. Any shallower of an exit would make the 2066.00 bias-down target become “unfinished business below.”
Drifting further down from the
Drifting further down from the 2082.50 overnight high greeted the Employment Situation report at 2075.50. Its fallout reached 2071.25, which has since recovered back up to the overnight high. Currently indicated to greet the open from above 2077, exiting the opening 15 minutes of volatility above 2080 would keep alive potential to trigger the 2082.25 bias-up signal at 10:15. Exiting the open under 2077 would make bias-up unlikely — and this morning”s action isn”t likely just to range sideways. Details and other markets coverage were discussed during the pre-market Tour, recorded here:
https://roddavid10.mitel-nhwc.com/join/vsxsbrk
The First Trade… Take a number.
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…
Thursday”s opening dive extended down 28 points through its 2070.00 noon hour low. The balance of the session trended up to test and retest 2080.00. The 2082.25 target of another buy signal was still in-play. The cash session close was at 2077.00, neither breaking it to trigger lower targets, nor recovering above it to confirm that its support had held. No oversold RSIs or other unfinished business was left outstanding below.
Overnight action”s new info…
The buy signal targeting 2082.25 had been threatened by a last-minute 5-point dip, which had ended within 3 minutes to maintain the signal”s momentum. The target”s test defined the overnight high, which reacted down to 2080.00, and then slid to 2075.50 into Europe”s opens. A 6-point recovery was retraced to back under 2077.00, which is being tested now ahead of this morning”s Employment Situation report.
If, then…
I highlighted the 2082.25 target being met to make clear there is no nearby unfinished business above. No upside attraction can be relied upon this morning to prevent or to inhibit extending the decline under 2077.00. So, rallying anyway would be that much more credible for extending higher intraday. Similarly, there is no unfinished business below requiring a retest before enabling a rally. Reacting down to this morning”s payrolls report must be isolated to an otherwise irrelevant timing window — pre-open, or the opening 15 minutes — to avoid gaining traction for a deeper and possibly much steeper slide into the weekend.
First Trade…
There are no preliminary levels ahead of an Employment Situation report. Join me in the chaRTroom at8:55am ET for the pre-market Tour to interpret the market”s reaction and to game out opening strategy.
2077 was a threat Monday
2077 was a threat Monday and Tuesday. It had figured prominently in our conversation during this weekend”s Saturday Review. There was that much room below without totally invalidating the potential for new highs. Thursday tested it down to 2070.
Despite testing 2107 Wednesday morning, already testing 2077 doesn”t make this dip any more likely or any less likely to extend down or to recover.
Thursday”s cash session close equated to 2077. Not below it to trigger lower targets, and not above it to begin suggesting its test was launching a recovery.
Was the drop just constructive defensiveness ahead of Friday morning”s Employment Situation report? That would be bullish from a contrarian perspective. If not, and with two days of illiquidity fast-approaching, then a bigger drop targeting 2035 could be well underway Friday morning.
Details and other markets coverage are in the post-market Tour here:
https://roddavid10.mitel-nhwc.com/join/kfyrczt
Switch to these URLs after 6:30pm ET to monitor the chaRTroom overnight:
Win XP-Friendly — http://anymeeting.com/442-444-879
non-xp friendly — https://roddavid10.mitel-nhwc.com/join/bfyytsh
Morning bias
| FRI morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2087.50 | 2082.25 |
| …would target | 2093.25 | 2088.00 |
| Bias-down: under | 2078.25 | 2073.00 |
| …would target | 2071.25 | 2066.00 |
| Signal status: LATE BIAS-DOWN | 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.