Posts by Rod David
Daily Spot… Crude drop strikes oil.
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 Jun Contract (EC, ETF: (FXE, UUP))
Gapping up Friday and ranging sideways kept alive the corrective bounce. Its potential to 1.1095 remains intact so long as 1.0910 holds any test as support.
Gold Aug Contract (GC, ETF: (GLD))
[Rolling coverage forward to Aug which trades at a 50-cent premium to Jun]… Friday”s blip-up in reaction to GDP was reversed immediately back into this week”s narrow range, all but confirming that the prior three sessions were not accumulative, and that lower objectives remain outstanding.
Silver Jul Contract (SI, ETF: (SLV))
Blipping up in reaction to Friday”s GDP didn”t extend higher. as lower objective remain outstanding in the 16.15-16.35 area.
30-year Treasury Sep Contract (US, ETF: (TLT))
[Rolling coverage forward to Sep which trades at a 1-18 discount from Jun]… Friday”s gap up attacked Thursday”s gap up, a little more successfully by extending through its 155-14 opening high to 155-27. But the probe quickly settled into narrow ranging around 155-14. The next higher objective in the context of only a temporary corrective rally can now be calculated as 156-16/156-24. Otherwise, back under 154-20 first would signal the bounce had ended already.
Crude Oil Jul Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Thursday”s late bounce had not ended the trend, but it did jeopardize its near-term momentum, making it vulnerable to a bounce. Despite retracing overnight firming before Friday”s open, a post-open $2 surge tested the original 59.75 sell signal, and then extended higher to attack 60.80. Just closing above 60.30 is now vulnerable to a bigger detour on the way down to 55.00 — which would be back in-play by closing under 58.15.
Natural Gas Jul Contract (NG, ETF: (UNG, UNL))
The next lower objective under 2.86 at 2.64 was tested Friday, and still being overlapped through the afternoon. The lower close also confirmed Thursday”s break from a mult-session range, so at least a third lower close is required eventually. And that would necessitate closing under the 2.64 objective, putting into play something lower. That something lower could be very much lower if a bottom isn”t forming here. So a bottom depends upon limiting a fresh low close to only a single session, and then immediately recovering above 2.67.
The deeper meaning of “bailout” headlines.
Decline retraces in reaction to Greek assurance to make payment.
This morning”s 2110.00 bias-down target was barely influential during the 2114.75-2102.25 plunge portion of this morning”s drop from 2118.00. It was overlapped by a Running Correction before resuming the plunge.
Oversold RSIs at the low require its eventual retest. And a corrective bounce to 2108.00 was retraced to within 1 tick of 2102.25 when a headline crossed. A bullish headline about Greece.
With stocks sliding, a Greek bailout equates to a bailout from the decline. The headline triggered a surge that extended to retest the Running Correction”s 2111.25 upper-end. Any higher would signal a much bigger rally underway, potentially marginalizing sellers for the day.
Otherwise, back under 2108.00 (being tested now, as the news is debunked or questioned) would more likely resume the decline — or, at least probe fresh lows down to 2099.75 or 2098.50.
Afternoon bias
| FRI afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 2117.75 | 2115.75 |
| …would target | 2123.25 | 2121.25 |
| Bias-down: under | 2106.50 | 2104.50 |
| …would target | 2101.75 | 2099.75 |
| Signal 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.
Post-open review,,, Isolating another bounce.
Failing to trigger the open”s recovery opportunity
Opening at or above 2118.00 was half the battle to isolating yet another probe under it. The other half of the battle was then to extend higher. The alternative would be very vulnerable to sliding sharply through the morning.
Indeed. The test of 2118.00 resistance reversed down and down and down. The 2110.00 bias-down target broke easily on the way to 2102.25.
Oversold 1-minute and 3-minute RSIs would doom to failure any bounce from here. But it doesn”t prevent a bounce. So long as a bounce didn”t recover 2108.50, a retest of Tuesday”s 2096.00 lows is now likely.
I know what you”re thinking.
I know what you”re thinking. All of these dips to 2112 and recoveries back above 2118-2121 — Isn”t the rally effort expending all of its buying pressure to hold its ground, and won”t have any buying pressure left to actually rally? Well, to tell you the truth, I”ve kind of lost track myself. But, seeing as how these rally efforts are funded mostly by the FOMC, the most powerful central bank in the world and would blog short-sellers” heads clean off, you”ve gotta ask yourself one question… Which we discussed during the pre-market Tour linked here:
https://roddavid10.mitel-nhwc.com/join/shkvbzb
But, in a nutshell, the one question is whether 2118-2121 can be recovered through the open. There”s no bullish reason to revisit 2112. Either way, this being a Friday, the the morning”s bias can persist through the noon hour.