Posts by Rod David
Morning Bias
| TUE morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2737.50 | 2738.50 |
| …would target | 2745.50 | 2746.50 |
| Bias-down: under | 2719.25 | 2720.00 |
| …would target | 2712.25 | 2713.00 |
| Signal status: LATE NO-BIAS, TESTED BIAS-UP SIGNAL | . | |
| 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)
Two consecutive sessions spent downtrending in negative territory were likely to bleed into a third. Monday fulfilled the setup, despite having rallied overnight to the morning’s 2795.50 bias-up target. Opening back down at its 2775.00 bias-down signal was only the beginning of a collapse that erased the last of last week’s rally. Not just Wednesday’s election results surge, but also the Tuesday and Monday rallies preceding it down to 2722.00.
Those two days were also consecutive sessions spent uptrending in positive territory, which bled into a third — Wednesday’s election results surge. Their different context allowed Monday’s initial selling to bottom, and for its recovery to be rewarded by retesting Wednesday’s high. Which is still possible, to the degree that Monday’s decline is rejected.
Just recovering interim resistance at 2739.00-2743.00 would be a start. Leapfrogging over it at Tuesday’s open would be the quickest signal of rejecting Monday’s decline, especially maintaining and extending a gap up to and or through Monday afternoon’s 2752.00 high. Meanwhile, extending this leg could reach 2786.00 before its next opportunity to try bottoming again.
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’s open gapped down under all prior lows and trended down intraday for the fourth consecutive session. The lower close already fulfills the minimum third lower close required by the confirmed breakout. But the persistent sentiment suggests bleeding into at least another session or more.
Gold Dec Contract (GC, ETF: (GLD))
Probing fresh lows overnight extended Monday to attack the 1201.50 objective, whose break would put into play 1172.50.
Silver Dec Contract (SI, ETF: (SLV))
Avoiding fresh lows overnight didn’t prevent resuming the decline Monday morning down to 14.00. Hovering at or above September’s low suggests “ineffectual optimism” that is bearish from a contrarian perspective. .
30-year Treasury Dec Contract (US, ETF: (TLT))
Having recovered from prior lows Friday up to the 138-04 buy signal, Sunday night easily began probing above it. But gapping up to 138-12 only fluctuated flat-to-higher, and has yet to actually rally.
Crude Oil Dec Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Gapping up above Friday’s low formed the basis of a reversal pattern, if it could be maintained and extended. Which it wasn’t. But at least its failure filled the gap back down to Friday’s close, so any initial strength Tuesday would be credible for extending higher intraday.
Natural Gas Nov Contract (NG, ETF: (UNG, UNL))
Already extending to fresh highs at 3.90 Sunday night was unsustainable, so Monday’s open gapped up only to test Friday’s highs around 3.80 and then range sideways. The “ineffectual optimism” makes any initial reversal down Tuesday likely to extend intraday, targeting 3.42.
Mid-day Update… Found them, yet?
Pause in decline might be a bottom. But only if…
The open’s collapse from 2777.00 to 2754.00 had not bounced until the bias environment was entered. 
It measured 8 points up to 2762.00. And then it collapsed. Fresh lows at 2733.50 produced a second bounce as the bias environment lapsed. It measured twice, gaining 16 points into the noon hour’s 2749.00 high.
The second bounce is now also failed, retracing its origin and probing fresh session lows by 1 point.
But it’s too late to trigger bias-down. Probing under this afternoon’s 2736.25 bias-down signal during the no-bias environment is called “no-bias trending” and will require eventually being retraced to the 2736.25 signal, regardless of the interim or ultimate resolution.
In fact, its dip is already retraced, and reversing to attack this afternoon’s 2746.50 bias-up signal.
“No-bias trending” rules would apply in either direction, requiring being retraced. But not necessarily reversed. Resuming the decline is still possible, as is reversing it — especially when the bias environment starts lapsing at 2:30.
Look ahead: Economic Calendar – for Tue Nov 13, 2018
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: Tuesday’s calendar has no post-open econ reports, only a Fed speaker with limited track record for influencing price action.
NFIB Small Business Optimism Index
6:00 AM ET
Redbook
8:55 AM ET
*Neel Kashkari Speaks
10:00 AM ET
3-Month Bill Auction
11:30 AM ET
6-Month Bill Auction
11:30 AM ET
4-Week Bill Auction
1:00 PM ET
8-Week Bill Auction
1:00 PM ET
Treasury Budget
2:00 PM ET