Posts by Rod David
Post-open Review… Buyers rejected again.
Gap up rejected.
Yesterday afternoon’s 2740.50 bias environment high produced fresh session lows. 
So, maintaining a gap up above 2740.50 would reject the prior afternoon’s drop. Gap up, maintain it, and extend it. Gapping up was maintained above 2740.50, but not extended. That’s still a position of strength, but with limitations.
One limitation was exceeded by triggering a sell signal under 2737.75. Then another limitation failed by not triggering bias-up. More so, both the 2735.50 AND 2742.45 bias-up parameters were rejected, putting into play offsetting tests of BOTH the 2718.00 and 2711.00 bias-down parameters.
The open’s setup wouldn’t have formed a session-long rally, but its failure is still likely to be as bearish as it could have been bullish. Having said that, this being a LATE no-bias environment instead of timely, not testing 2711.00 could avoid probing under yesterday’s lows and still maintain the Isolation setup that hasn’t been rejected.
The First Trade & Pre-open Tour Recording… Isolating both ends of the candle, again.
Proper context can start the day with a solid win and make all the difference.
DAILY SCHEDULE
First, watch the pre-open Tour recording HERE <<==
Then, meet in the chaRTroom here by 9:15 ET for updates and Q&A
Through the prior close…
Tuesday’s open foreshadowed the session, and not just for ignoring several recovery opportunities. Its 5-point gap up first extended higher, and was soon reversing down on its way to fresh lows. The pattern repeated intraday, recovering again to fresh session highs well before noon. The balance of the session trended back down to retest the morning’s lows, which held through the close. Session lows retraced all of last week’s gains back down to the prior Friday’s close. Closing just 1 point under Monday’s close was essentially unchanged, but it wasn’t back above a prior high which would have trapped sellers — perhaps not a bad showing after the open had ignored its recovery opportunities.
Overnight action’s new info…
Globex immediately rallied out of Tuesday’s close to attack 2744.00. Its consolidation was contained within what is this morning’s 2735.50-2742.25 bias-up parameters. Buyers never attracted reinforcements before resolving down to 2725.00 well before midnight, where another consolidation formed around unchanged. Breaking lower again into and out of Europe’s opens slid sharply for two hours until touching what is this morning’s 2711.00 bias-down target. A two-hour rally from there back to unchanged around 2725.00 has recovered a brief dip to now test 2730.00.
If, then… (notes to accompany the Tour recording)
So, is the market stair-stepping its way down to the next lower targets, which are 2696.00 and then 2786.00? Last night’s low repeated Monday night’s momentary dip under the intraday low, albeit much later in the session than Monday night’s initial dip. Bottom-fishers haven’t been comprised of strong-handed buyers, as seen by ending each period at or near its lows. Strong-handed buyers would push a timing window through a relevant resistance — this morning, that would be back above yesterday afternoon’s 2740.50 high, which already held last night’s initial strength.
First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 under 2715.00 would be likely to trigger the 2718.00 bias-down signal at 10:15. Exiting the open above 2721.75 would be unlikely to trigger bias-down. Exiting the open under 2732.50 would be unlikely to trigger bias-down.
Morning Bias
| WED morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2734.50 | 2735.50 |
| …would target | 2741.25 | 2742.25 |
| Bias-down: under | 2717.25 | 2718.00 |
| …would target | 2710.25 | 2711.00 |
| Signal status: LATE NO-BIAS, TESTED BOTH BIAS-UP PARAMETERS | . | |
| NEW: BIAS VIDEOS… INTRO // EXAMPLE | ||
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.
Market Wrap (recording & summary)
It might seem odd that Tuesday’s session shared a relevant feature to last Thursday and Friday, since Tuesday ranged choppily sideways, but Thursday and Friday trended down exclusively in negative territory. How are those similar? Because both sets expended a lot of selling pressure, without maintaining a break under a relevant support.
Thursday and Friday retraced much of its prior session’s (Wednesday) rally. Tuesday has retraced all of its prior session’s (Monday) range.
Of course, Thursday and Friday did resolve down through relevant support. Tuesday’s session may yet do the same, and for a similar reason — bottom-fishers aren’t comprised of strong-handed buyers, as seen by ending the period at or near the lows. The next lower objective is 2696.00 and then 2786.00. Gapping up above Tuesday afternoon’s 2740.50 high would start to signal momentum reversing up, instead.
Details and other markets coverage are discussed in the post-market Wrap recording here.
Monitor overnight Globex trading in the chaRTroom here.
Daily Spot…
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 Dec Contract (EC, ETF: (FXE, UUP))
Monday had fulfilled the minimum objective of Thursday’s confirmed breakout, creating vulnerability to a bounce, which developed overnight but not until probing fresh lows at 1.1245. Gapping up within Monday’s range was reversed back into Monday’s range after temporarily probing above it, which doesn’t reverse the trend up.
Gold Dec Contract (GC, ETF: (GLD))
Post-close action Monday had tested the decline’s minimum 1201.50 target, whose break would next target 1172.50. Fresh lows Tuesday probed further under the signal and then held its test as resistance.
Silver Dec Contract (SI, ETF: (SLV))
Tuesday’s fresh lows didn’t extend, certainly not at any aggressive pace, but the decline’s momentum remains intact.
30-year Treasury Dec Contract (US, ETF: (TLT))
Monday’s gap up was not extended overnight or Tuesday morning, which instead opened back down to the 138-04 buy signal that is awaiting a valid trigger. Recovering into the afternoon pierced positive territory sporadically, still likely to extend higher aggressively if extending higher at all.
Crude Oil Dec Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
A post-close slide to fresh lows Monday foreclosed upon the 61.00 buy signal that could have triggered after Monday’s intraday bounce. The slide became a plunge — the deepest in 3 years — down to 55.70 intraday, and continued sliding post-close.
Natural Gas Nov Contract (NG, ETF: (UNG, UNL))
Trending up to fresh highs overnight ignored Monday’s “ineffectual optimism” and its vulnerability to launching at least a corrective dip. The pattern of two breakouts interrupted by a non-confirmation often produces another non-confirmation Wednesday, which would be vulnerable to reversing down into the afternoon.