Posts by Rod David
Post-open review… Everyone’s ahead of themselves.
Overnight drop is recovered, overnight recovery is retraced.
The pre-open bounce held its test of 2045.75 and reacted down to 2040.25. Being the “lower prior highs” of the overnight head & shoulders pattern, its support launched an obligatory bounce.
It was quite a bounce, fulfilling its objective to test this morning”s 2050.25 bias-down signal as resistance. Just touching it was enough to end the bounce, triggering a reaction down.
It was quite a reaction down, retracing all of the pre-open rally from 2036.25. Being the original 61.8% projection of the overnight head & shoulders pattern, its support launched another obligatory bounce.
At least, that”s the premise right now — that bouncing is only temporary.
The overnight head & shoulders pattern did influence the opening 15 minutes of volatility, so it should continue influencing intraday action. And having bounced above its “head” after only a singular break lower met its 61.8% target, the pattern”s 161.8% 2034.50 and 261.9% 2030.75 targets are attractions.
But there is no required attraction below, at least not in any particular timing window. Exiting the bias environment at 11:30 back above its 2050.25 bias-down signal would suggest a much bigger bounce underway, targeting well into yesterday”s range. But the overnight lows should be retested eventually, anyway.
For lunch today, how about
For lunch today, how about a big portion of Livestox?
Starting at 12:15pm ET, we”ll be at
https://roddavid10.mitel-nhwc.com/join/pcxsrhm
Optional teleconference instructions (required for iPad and tablets):
1-605-562-0020
Meeting ID 976-912-682 #
Other requirements can be found here:
http://marketfy.com/product/stock-technical-trade-alerts/blog/1143/view/60141/
The pre-open bounce from 2033.25
The pre-open bounce from 2033.25 did correct from touching the 2042.00 bias-down signal as resistance. A 61.8% retracement at 2036.50 snapped back up to a fresh high. Now 2045.00 is being probed by a couple of points. Its recovery (or not) through 9:45 would preliminarily suggest whether the 2042.00 bias-down target will be broken again through 10:15. Opening under 2045.75 and sliding through 2044.25 could offer early confirmation that 2045.00 won”t be recovered by 9:45, and that the overnight lows can be retested today. Recovering 2045.00 instead would at least target a retest of the 2050.25 bias-down signal as resistance. Here”s the pre-market Tour recording for more:
https://roddavid10.mitel-nhwc.com/join/pcxmrhm
The First Trade… Opening at a prior low’s support.
Proper context can start the day with a solid win and make all the difference.
Enter the Chartroom here
(pre-open Market Tour begins at 8:55 ET)
Through the prior close…
Invalidating Wednesday morning”s no-bias was easily done by a 13-point plunge from 2080.00 into the noon hour. That doubled through the close to 2052.25, touching the week-old low that had printed just minutes before the FOMC event.
Overnight action”s new info…
2052.25 tried its best to hold, but there was no buying effort. Support finally gave way an hour before Europe”s opens, dropping relentlessly to within 1-2 ticks of the last relative low at 2033.25. The reaction up from there has reached 2042.00, still down double-digits from yesterday”s close.
If, then…
Middle East war causing higher Crude Oil is the latest basket of straw on the market camel”s back. Being this morning”s bias-down target, 2042.00 will act as resistance when tested from below. Probing above it and holding as support through 10:15 would at least avoid renewing the bias-down signal. But the morning”s bias environment would still be bias-down. If a temporary rally like yesterday afternoon”s bias environment is possible, its best chance is probably from a quick probe under the 2033.25 low. Already bouncing back above 2045.00 at the open could follow-through initially, but still not with any confidence of avoiding a later downdraft.
First Trade…
Exiting the open at 9:45 above 2045.00 would be unlikely to renew the bias-down signal, and likelier to hold the 2042.00 bias-down target through 10:15. Exiting the open under 2037.00 would be likely to renew the bias-down signal by not recovering the 2042.00 bias-down target.
Having trended down into the
Having trended down into the close, from an afternoon high that printed before the last 60-90 minutes, gapping up sharply tomorrow could reverse direction for a couple of days. Ending the correction sooner rather than later required this leg to be quick and impatient. That”s the likeliest path higher, likelier than to try recovering from fresh lows. Gapping up too shallowly would be likely at least to probe fresh lows intraday. And fresh lows intraday could simply extend the decline. The bottom line is that a lot of selling pressure has been expended very recently, and it has met its objectives, but not recovering by noon Thursday would suggest a much downleg is underway. Here”s the post-market Wrap recording for more:
https://roddavid10.mitel-nhwc.com/join/cxwkwwz