Posts by Rod David
Post-open review
Down the up staircase?
The 2052.25 overnight high”s retest wasn”t even contemplated by the open, which had pulled back to 2047.00. Choppy ranging back up to 2049.50 finally resolved down.
Now this morning”s 2041.00 bias-down signal is being probed. It”s too late to trigger, or to invalidate the no-bias signal. Probing under it at this late stage is “no-bias trending” that requires eventually being retraced.
So, probing under it to test the decline”s 2037.00 target would require its complete retracement. Often, that would include the 10:15 print, which this morning was 2045.50.
That”s essentially the only remaining path up today. Regardless of the calculable levels, just closing above this morning”s 2049.25 high would form a bullish Pivot Reversal — rejecting the intraday new trend low to confirm the gap up.
Meanwhile, until either testing the 2037.00 target, or at least the 2039.50 low”s oversold RSIs and then retracing the no-bias trending, the decline remains intact.
Retracing yesterday”s late plunge was
Retracing yesterday”s late plunge was last night”s first order of business. After correcting that upleg, its next job was to retrace back up to Tuesday”s last half-hour high. Now that upleg has been corrected, too. But did the overnight recovery has been corrected so the open can extend the overnight rally? If not, then the overnight rally corrected yesterday”s drop, so that the drop can now resume. We discussed parameters for both scenarios during the pre-open Market Tour, recorded here:
https://roddavid10.mitel-nhwc.com/join/bwzspcj
The First Trade.
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…
Tuesday”s open gapped down 17 points to a new low, immediately fulfilling the decline”s 2060.00 target. The morning”s extended down to test the next lowest target at 2048.50, which then supported flat-to-lower ranging through the afternoon. That is, until the position-squaring window ended. The session”s last several minutes plunged to 2041.25
Overnight action”s new info…
Immediately rallying until retracing Tuesday”s late plunge then corrected into Europe”s opens. Higher highs reached 2052.25. Its reaction down is now testing the late plunge”s 2048.50 origin as support. By several ticks.
If, then…
Having trended down into yesterday”s close, gapping up above yesterday afternoon”s 2054.25 high would form a “session-long rally” setup. That has been attempted to within 4 points, which isn”t yet close enough to consider a failed attempt. That would invert the potentially bullish setup into being bearish. Meanwhile, 2048.50 and 2056.00 are big lines in the sand that can define whether the decline extends next to 2037.00, or begins a big recovery attempt.
First Trade…
Exiting the open at 9:45 under 2047.75 would be unlikely to trigger the 2053.25 bias-up signal at 10:15. Exiting the open above 2055.00 would be likely to trigger bias-up. And exiting the open under 2043.50 would be likely at least to test the 2041.00 bias-down signal.
Morning bias
| WED morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2054.50 | 2053.25 |
| …would target | 2060.25 | 2059.00 |
| Bias-down: under | 2042.25 | 2041.00 |
| …would target | 2035.25 | 2034.00 |
| Signal status: NO-BIAS | 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.
A short-squeeze from Tuesday afternoon”s
A short-squeeze from Tuesday afternoon”s low would have been signaled before the final hour. But the final hour”s entry barely pierced the session low. Only after the position-squaring window closed at 3:52, did the low begin breaking lower. There isn”t a lot of weak-handed optimism available to refuel sellers from above. So, trending down further requires attracting new sponsorship. First, fresh lows can be probed, regardless. Here”s more of that discussion in Tuesday”s post-close Market Wrap recording:
https://roddavid10.mitel-nhwc.com/join/rkrmbmv