Posts by Rod David
Morning bias
| TUE morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2116.75 | 2110.75 |
| …would target | 2122.50 | 2116.50 |
| Bias-down: under | 2109.50 | 2103.50 |
| …would target | 2104.00 | 2098.00 |
| Signal status: BIAS-DOWN, BIAS-DOWN 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.
Pre-close view… Pullback proving time.
Afternoon recovery attempt needs to reassert itself. Now.
This afternoon”s bias environment was greeted at 1:20 testing pullback lows under 2107.00. The bias environment exit at 2:30 had trended back up to 2111.75.
That was just under the noon hour”s high. Exiting the bias environment above the noon hour”s high would have been bullish. Entering the final hour above the bias environment”s high would have been bullish, too. But it was entered at 2109.25.
No price action is possible anymore today that can indicate that buyers gained traction for their efforts. That doesn”t prevent extending higher into the close — which would not be likely without already trending up through the 3:10-3:20 timing window that just opened. But if buyers can”t grab new ground this afternoon, then extending higher tomorrow would require gapping up.
Extending higher remains the likeliest scenario. That would be undermined by dipping too deeply this afternoon. So, without already trending up now during the 3:10-3:20 timing window, the balance of the session could just range choppily sideways.
Daily Spot… Winding up the Euro. Check.
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))
The confirmed breakout rested on its laurels for another day Monday, but didn”t really trap shorts by dipping deeply. Its shallow gap down didn”t extend, and the session ranged narrowly sideways, Further delaying the rally would be suspicious.
Gold Jun Contract (GC, ETF: (GLD))
Gapping up Monday to test 1187.00 resistance from testing the 1170.00-1174.00 target doesn”t begin a recovery any more credibly than did the prior gap up from attacking 1170.00-1174.00 to within a dime. But testing either 1187.00 or 1194.50 should contain the bounce and resume the decline..
Silver Jul Contract (SI, ETF: (SLV))
Monday”s gap up tested the upper-end of 16.50-16.65 resistance, and later probed above it. But the resistance should react back down to 16.15 before a durable rally leg can begin.
30-year Treasury Jun Contract (US, ETF: (TLT))
Monday was the fourth day of the four-day sequence, in which two consecutive breakouts would not be confirmed. That meant not closing negative. It”s not a required setup, just likely — likely enough to earn confidence buying into support. Testing 156-24 support down to 156-20 firmed, but didn”t react up enough to avoid closing negative. So, having confirmed Friday”s breakout, an eventual third lower close is now required, and now just likely — presumably at the outstanding 156-08 target, and potentially lower to 154-02.
Crude Oil Jun Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Initial strength Monday was quickly retraced and reversed down to the 58.65 pullback limit. That held, keeping alive the upward momentum of last week”s confirmed breakout, targeting 61.75 and potentially also 62.45.
Natural Gas Jun Contract (NG, ETF: (UNG, UNL))
Despite easily having room to correct down to 2.67, Monday”s 2.74 low could hardly wait to recover back up to and through Friday”s 2.80 high. That impatience doesn”t prevent extending higher, but closing above 2.84 or back under 2.73 would be likelier to extend in.that direction.
Scared away buyers?
Open”s surge to resistance is backing-and-filling.
The first half hour had gapped up above the 2103.00 bias-up signal, extended through the 2109.50 bias-up target, and tested the 2114.75 renewed bias-up target. Twice. Actually, that second test came several minutes later.
Anyway, a lot of buying pressure had been expected, but also fully rewarded. Exceeding the renewed bias-up target could have renewed the signal again. Instead, price action since then has dipped back down to this morning”s original 2109.50 bias-up target.
Now the bias environment has lapsed. The noon hour is almost beginning to lapse. And 2109.50 is still being tested.
There”s a couple of points of room for noise under it down to 2107.50, but any lower would start targeting Friday”s 2102.00 “lower prior highs.” That”s under this afternoon”s bias-down signal, so timing would be very important. Otherwise, back above 2111.75 would resume the rally, next targeting new highs.
Even the most bullish scenario requiring new highs — which we happen to be in — wouldn”t be reliable to resume the rally today. It would not inappropriate, but it”s not required.
Look ahead: Economic Calendar – for Tue May 5 2015
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: Only one of Tuesday”s econ reports has any track record for influencing price action, which is the ISM number. Meanwhile, the noon hour Fed speaker isn”t likely to be surprising, although anything they say now can imply the difference of months among rate hike expectations.
International Trade
8:30 AM ET
Gallup US ECI
8:30 AM ET
Redbook
8:55 AM ET
PMI Services Index
9:45 AM ET
*ISM Non-Mfg Index
10:00 AM ET
4-Week Bill Auction
11:30 AM ET
*Charles Evans Speaks — dove
12:25 PM ET