Posts by Rod David
Pre-close view… Ready to rock.
Signs of sellers sold out, and of buyers buying in.
Today”s likely objective was a test of 2112.00. Its test was delayed until the noon hour, where weak hands dominate. And the dip to its fresh low began after noon, and was recovered before the noon hour was fully exited.
All of which suggests sellers are nearly finished. That”s not accumulation, but it does open the door.
Exiting the bias environment above the noon hour”s high, and entering the final hour above the bias environment”s high… that”s accumulation.
So, buyers have gained traction for their efforts. Whatever else might happen before today”s close, and so long as Wednesday doesn”t gap down under today”s lows, tomorrow morning is likely to rally. The balance of today”s session is likely to rally, but not required.
Back under 2114.50 would suggest that one more brief dip was being worked in. But the rally should otherwise resume shortly.
Daily Spot… Euro lets its vulnerability show.
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 fulfilled the last remaining upside attraction by retesting 1.1414 — both overnight and post-open. The resolution was not immediate, but it was substantial, as Tuesday”s open gapped down sharply to 1.1214. The session did not trend down, so bounces should be shallow before extending the break, preferably no higher than 1.1250-1.1275.
Gold Aug Contract (GC, ETF: (GLD))
Monday”s steep drop to test 1183.70 support extended down Tuesday morning to attack the next relevant support at 1175.00. Despite it holding, the second consecutive lower close did confirm Monday”s breakout. The next lower objective is 1158.50.
Silver Jul Contract (SI, ETF: (SLV))
Tuesday”s break lower to test 15.70 is a breakout. Follow-through Wednesday is likely, but not necessarily a second consecutive confirming lower close. Confirmation would be credible, but we”ll be monitoring for any signs of recovery.
30-year Treasury Sep Contract (US, ETF: (TLT))
Filling the gap Monday back down to Thursday”s close without reacting up had made a fresh low likely. Tuesday”s gap down initially extended lower to test 148-08. Recovering back above 148-20 nearly filled the gap back to Monday”s 149-24 close. That slight pessimism might be enough to trust early strength above 150-08 for extending higher. Closing back above under 148-20 would instead signal a new downleg underway.
Crude Oil Aug Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Monday”s late surge had stopped short of attacking 60.70 and was retraced overnight to 59.55 after Tuesday”s open. But another surge probed 60.70 and tested the 61.20 buy signal. EIA reports Wednesday morning.
Natural Gas Jul Contract (NG, ETF: (UNG, UNL))
.Gapping up Tuesday above 2.77 began to signal that Monday”s narrow ranging at prior lows had not gained traction. Closing above the 2.77 buy signal was another matter, as the balance of the session dipped back down to Monday”s 2.72 close.
The price of patience.
Late rally effort finds plenty of sellers.
By ranging sideways through yesterday afternoon, the session rally had not gained traction for its effort. Gapping up today and extending quickly would have signaled new sponsorship had arrived. But any delay between the two would signal the extension was an afterthought.
In fact, the open”s gap up to 2117.25 consolidated through the entire first hour, and only then did it probe higher. The probe didn”t last 3 minutes before reversing down sharply from 2020.25.
The minimum objective for reversing down was 2113.50, being the morning”s bias-down signal and being too late to trigger it. So long as 2116.00 wasn”t recovered, the likely objective was a test of 2112.00.
2112.00 is being tested now during the noon hour. The noon hour is an appropriate window for noise, and recovering 2114.50 would signal the drop”s noise was absorbed.
Meanwhile, price action since yesterday morning”s high is still likely only a temporary consolidation. There is room down to this afternoon”s 2108.25 bias-down signal before suggesting otherwise. But that”s not required, and 2112.00”s test could just as easily service as the consolidation”s bottom.
Look ahead: Economic Calendar – for Wed Jun 24 2015
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: Wednesday”s GDP is high-profile, but it has no track record of influencing price action. The noon hour”s 5-year note auction can inhibit the market until it comes in, which usually resolves in a “relief rally” of some sort.
MBA Mortgage Applications
7:00 AM ET
GDP
8:30 AM ET
Corporate Profits
8:30 AM ET
EIA Petroleum Status Report
10:30 AM ET
2-Yr FRN Note Auction
11:30 AM ET
*5-Yr Note Auction
1:00 PM ET
Afternoon bias
| TUE afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 2124.25 | 2116.00 |
| …would target | 2129.25 | 2121.00 |
| Bias-down: under | 2116.50 | 2108.25 |
| …would target | 2111.50 | 2103.25 |
| Signal status: NO-BIAS | FAQ | |
| INTRO VIDEOS #1 and #2 | ||
1. At 1:20, 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 1:20 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 1:20 would invoke a grace period through 1:30 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 1:30 after invoking the grace period would trigger “noN-bias,” with no bias influence.