Posts by Rod David
Hunkered down. And down. And down.
Pessimism took a breather.
This morning”s dive to 2084.50 held two tests — one during an irrelevant timing window, and the other by an errant tick that reacted up immediately on its way to 2096.50.
Not for lack of trying, but the bias environment exit was back under its 2093.50 bias-down signal. Recovering it into the noon hour would have sealed a bottom and reversed up through the afternoon. But dipping into the noon hour”s entry tested 2088.50.
Sellers didn”t regain control. But buyers have been rewarded for absorbing this morning”s dips under 2086.50. Back under the 2088.00 area (being tested now) would start to signal a probe underway of fresh lows. And not isolating it to the noon hour would again risk extending down sharply.
Meanwhile, having failed a timely recovery above 2093.50, exiting the bias environment above 2093.50 would still be bullish, but above 2098.00-2099.00 would deserve more confidence.
Afternoon bias
| THU afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 2101.75 | 2095.25 |
| …would target | 2108.00 | 2101.50 |
| Bias-down: under | 2091.50 | 2085.00 |
| …would target | 2084.25 | 2077.75 |
| Signal status: NO-BIAS, TESTED BIAS-DOWN SIGNAL | 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… Are they through, yet?
Bias-down target met, probed, and held?
The pre-open bounce to 2098.00-2099.00 resistance was repeated post-open, but only to its lower-end. The bigger picture already had made fresh lows likelier than to recover. And back under 2095.00 signaled that to be underway.
A singular effort extended down to fresh lows at 2084.25, satisfying all downside objectives. A bounce to 2089.75 held up above the 2086.50 bias-down target through 10:30, to avoid renewing the bias-down signal
This is still a bias-down environment. Despite not renewing its signal, a fresh low was probed down to 2083.50. Had the signal renewed, the next lower objectives would be 2077.00 and 2070.00-2072.00.
Back above 2087.00 and 2088.50 would be credible for reversing back up. The probe under 2084.25 was isolated between 10:15-10:30, it was within 3 ticks of 2084.25, and its RSIs diverged positively.
Optimal timing would have been to trigger the recovery signals by 10:30. And a fully-formed buy setup that doesn”t actually trigger tends to become as bearish as it would have been bullish. So, look out below if 2087.00 and 2088.50 aren”t recovered soon.
Doesn”t look like 2086.50 will
Doesn”t look like 2086.50 will be avoided. Not after the pre-open recovery up to 2098-2099 resistance reacted down sharply to attack the 2090.25 overnight low. So, the big question may be whether the retest of Tuesday”s low can be isolated to an irrelevant timing window, i.e. recovered before noon. More detail in the pre-market Tour recording here:
https://roddavid10.mitel-nhwc.com/join/vsmxfpk
The First Trade… Still seeking out lower levels.
Proper context can start the day with a solid win and make all the difference.
Enter the
chaRTroom here
Still testing
Anymeeting CLICK HERE
(pre-open Market Tour begins at 8:55 ET)
Through the prior close…
Seeking out buyers at lower and lower levels. Tuesday”s recovery had failed to attract new sponsorship above its 2110.25 intraday high, forcing it to seek out buyers below. Its 2098.00 pullback target defined Wednesday”s open and the bias environment”s low. The noon hour”s dive to 2090.50 was recovered in time to greet the FOMC statement from above 2098.00. Rallying to 2108.00 was a little premature, and the day ended back at 2098.00.
Overnight action”s new info…
Europe”s opens again marked a different tenor as sideways ranging until then suddenly broke lower. Yesterday”s low was pierced by 1 tick at 2090.25. Headlines have been active on BOJ, Ruble, and Greek pension payments.
If, then…
Yesterday”s FOMC reaction was inhibited from extending higher, because of excessive optimism during its initial reactions down to 2095.25. It could have been remedied yesterday at 2093.50. Having tested 2093.50 overnight, gapping up today above 2104.25-2105.00 and extending through yesterday”s highs above 2108.00 would serve by proxy for the delay. Otherwise, the delay now requires retesting Tuesday”s 2088.25 low. Too low could start to attract much more substantial selling pressure.
First Trade…
Exiting the open at 9:45 under 2090.00 would be likely also to trigger the 2093.50 bias-down signal through 10:15. Exiting the open under 2085.00 would be unlikely to recover the 2086.50 bias-down target by 10:15, renewing its bias-down signal. Exiting the open above 2101.50 would make the bias-down signal unlikely to trigger.