Posts by Rod David
Testing yesterday morning”s 2068.50 bias
Testing yesterday morning”s 2068.50 bias environment low as resistance had reacted down to within 1 tick of this morning”s 2059 bias-up target. It served as support to try resuming the rally, but that has only attacked the overnight high. Back above 2067.50 through the open could still suggest the overnight rally has resumed, which would have other bullish implications. But not holding 2060.75 as support would suggest instead that the overnight rally had expended all available buying pressure. And, like yesterday”s overnight rally, a new round of selling would be attracted to sponsor the next leg down. Here”s more detail in the pre-market Tour recording:
https://roddavid10.mitel-nhwc.com/join/bwhcmbz
The First Trade… Corrective bounce leaving little on the table.
[MY APOLOGIES FOR THE TARDINESS OF THIS POST…]
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…
Gapping down Monday in extreme sentiment tried to behave like a sentiment extreme, rallying through the opening 15 minutes of volatility. But that works only when testing a prior low, as support, and not when opening beyond the range. Testing the morning”s 2082.25 bias-down target as resistance sent price relentlessly down 35 points to 2047.25, probing Sunday night”s low by 7 points, while testing and retesting the next lower objective of 2048.25 as RSIs diverged positively.
Overnight action”s new info…
.Firming up to 2058.00-2059.00 through Europe”s opens had dipped back down to 2053.00, when a surge broke sharply higher to 2069.00. Its 10-point reaction down to attack 2059.00 is trying to recover.
If, then…
Extending the plunge at this morning”s open was not assured. No new traction was gained Monday afternoon and downside objectives held their tests. Those conditions were true at Friday”s close, too, but Monday”s plunge was the product of new sponsorship. There being no new sponsorship overnight, the downleg was vulnerable to correcting back up. If counter-trend sponsorship has been attracted, then the correction will recover relevant levels through relevant timing windows. Maintaining a gap up back above yesterday afternoon”s ~2061.00 high, for example, could form a “session-long rally.” But too much higher could find the overnight bounce has already satisfied the counter-trend sponsorship. An example of that would be to hold a test of a prior timing window”s range — like yesterday morning”s 2068.50 low. Exceeding any relevant level tested during the open would help to reverse the trend back up today. Failing that would extend the plunge this morning.
First Trade…
Exiting the open at 9:45 above 2067.50 would be likely also to exceed the 2059.00 bias-up target through 10:15 to renew the bias-up signal. Back under 2054.00 through 9:45 would be unlikely to trigger the 2053.00 bias-up signal at 10:15.
Morning bias
| TUE morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2061.50 | 2053.00 |
| …would target | 2067.25 | 2059.00 |
| Bias-down: under | 2054.50 | 2046.25 |
| …would target | 2048.75 | 2040.25 |
| Signal status: BIAS-UP, BIAS-UP TARGET MET | 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”s open did exactly what
Monday”s open did exactly what on Saturday we described would keep the balance of the session under pressure. Trending up immediately from gapping down didn”t let pessimism form, which would otherwise cleanse the market of weaker buyers. And we didn”t even know Saturday that Sunday night”s gap down would have already done the same thing, making the open”s optimism more problematic.
Regardless, the open”s reaction down from 2082.25 resistance had created an objective to retest Sunday night”s 2054 low. The 2049.50 target of its retest produced a temporary bounce. RSIs diverged positively on its retest. LIKE Friday, selling pressure is satisfied without signaling an extension, but also without signaling a reversal. UNLIKE Friday, however, weekend illiquidity isn”t keeping away
So, the decline”s momentum remains intact, unless Tuesday”s open were to trend up. Whichever direction Tuesday morning were to trend, the impending three-day holiday weekend can leverage it to extend sharply in that direction. Gapping up Tuesday above Monday afternoon”s ~2061 high could even form a “session-long rally.” Something so substantial at this stage would be unlikely without a headline to match it.
Monday”s post-market Wrap recording:
https://roddavid10.mitel-nhwc.com/join/mjztjyx
Overnight monitoring of the chaRTroom
XP-Friendly: https://www.anymeeting.com/149-387-912
xp UNfriendly: https://roddavid10.mitel-nhwc.com/join/shkphyy
Pre-close view… Uh-oh, optimism is alive.
Attack on overnight low is reacting up sharply.
This afternoon”s 2066.50 bias-down signal”s 2060.25 bias-down target was attacked to within 1 tick when price dumped another 2 points in a single minute. That was proof the drop was extending down. Being within 10-15 minutes of the bias environment lapsing made it likelier.
The drop did extend, down to 2054.75. That”s within 3 minutes of the overnight low, essentially fulfilling the objective of the impatient post-open rally attempt that had quickly met its 2082.25 target.
A steep 7-point reaction up to 2061.75 confirms this is a relevant support area. But the steep surge reflects an impatience that prevents this relevant support from holding.
It might not even define this afternoon”s low. The 7-point bounce has dipped back down to 2058.75 whose break would target fresh lows at 2049.50. And that could not only delay a bottom, but also accelerate selling pressure to get in front of the July 4 3-day weekend.