Posts by Rod David
Pre-close view… Constructive pessimism?
The bias environment probed under the noon hour”s 2078.50-2082.00 range, but was exited back above its low. The final hour was entered under the noon hour”s range, but above the bias environment”s low.
The 3:10-3:20 timing window can be a tie breaker.
Trending down under the bias environment”s 2076.75 low would be vulnerable to attacking session lows — which isn”t much, possibly just to 2073.00. Just trending up above 2081.00 by then would be likely to extend higher through the close.
Daily Spot — Crude Oil, extending its target, bonds about to face facts.
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 Mar Contract (EC, ETF: (FXE, UUP))
Backing off to attack 1.0900 late Monday was too late to maintain the bearish scenario. It would still require Tuesday”s close to be under 1.0855. Tuesday”s open gapped down to test it, and just still overlapping it at the close would reinstate the bearish scenario — so long as 1.0900 were not recovered again.
Gold Jun Contract (GC, ETF: (GLD))
The 1213.00 and 1208.50 pullback limits were both tested Tuesday. Closing underboth on the same day would have been bearish, but not already closing back above both now requires closing above 1218.00 to signal that momentum is reversing back up.
Silver May Contract (SI, ETF: (SLV))
Room for a pullback down to 16.80-16.90 was probed fully overnight, and held intraday Tuesday. Closing back above 17.05 would signal the rally had resumed.
30-year Treasury Jun Contract (US, ETF: (TLT))
Narrow sideways ranging Tuesday avoided resuming the rally, which is in-line with the bigger distributive pattern, as an accumulative pattern would not remain under pressure within two days of a new high. But the pattern”s timing should now recognize the lack of recovery and extend down more aggressively.
Crude Oil May Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Tuesday”s post-open surge probed above prior highs to attack 53.85. Holding 52.50 as support would be optimal for maintaining potential to 56.00.
Natural Gas May Contract (NG, ETF: (UNG, UNL))
Firming Monday night back to Thursday”s close didn”t qualify as filling its gap. Dipping back down before Tuesday”s open helped to restrain the optimism so that sellers could be marginalized. Actually filling the gap intraday without yet reversing down makes any fresh high Wednesday likely to extend higher intraday — and potentially to greet Thursday”s EIA report from a position of strength.
The dominoes start to fall (up).
This morning”s 2082.50 bias-up target was touched, fulfilling the buying pressure that created it. Its reaction down tested the 2077.50 bias-up signal as support. And still being a bias-up environment, the bias-up signal”s support held.
Now the bias environment has lapsed into the noon hour.
The morning”s high was attacked to within 3 ticks. Confirming the rally will resume today would require probing fresh session highs during the noon hour, and exiting the noon hour above the morning”s highs.
Back above 2081.00 would be credible for resuming the rally. But that must happen quickly, or else the next window would be delayed until after the afternoon bias environment begins lapsing at 2:30.
Meanwhile, there”s no bearish reason for this morning”s test of last week”s high. And accumulation has been active — yesterday”s final hour dip, the two pre-open dips, the post-open dip… not to forget Friday”s Globex dip… each recovery to fresh highs suggests that sellers aren”t yet able to retake control.
Look ahead: Economic Calendar – for Wed Apr 8 2015
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights:
Wednesday afternoon”s FOMC Minutes release doesn”t have the impact of the original policy statement, but it does help to handicap the likelihood and timing of a rate hike that was the last meeting”s focus.
MBA Mortgage Applications
7:00 AM ET
EIA Petroleum Status Report
10:30 AM ET
10-Yr Note Auction
1:00 PM ET
FOMC Minutes
2:00 PM ET
Afternoon bias
| TUE afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 2089.75 | 2082.50 |
| …would target | 2096.25 | 2089.25 |
| Bias-down: under | 2082.00 | 2075.00 |
| …would target | 2077.00 | 2069.75 |
| 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.