Posts by Rod David
Trapping more shorts?
Extended drop is missing key windows.
The bias environment”s 2044.00 exit at 2:30 was under the noon hour”s 2046.25 low. The final hour”s 2042.00 entry narrowly avoided probing under the bias environment”s 2041.00 low.
Actually, the final hour”s entry narrowly DELAYED probing under the bias environment”s low. Fresh lows down to 2036.75 soon followed.
The next lower objective under the 2038.75 overnight low is 2032.00-2033.75. RSIs did just diverge positively, so back above 2041.00 would signal momentum reversing up already.
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 Mar Contract (EC, ETF: (FXE))
Failing to hold the pullback limit Friday and close testing 1.1325 didn”t extend down until well after bouncing from Sunday night”s flat open. The 1.1363. high was attacked after probing fresh lows down to 1.1275. An initial trending Tuesday would be credible for reversing the trend back up.
Gold Apr Contract (GC, ETF: (GLD))
Gapping up Monday only ranged sideways and only under the bounce limit. The decline”s target was met and held Friday, but no new signal has been generated.
Silver Mar Contract (SI, ETF: (SLV))
Monday”s bounce tested “higher prior lows” around 17.10, but didn”t recover any resistance that might signal momentum reversing up.
30-year Treasury Mar Contract (US, ETF: (TLT))
Firming Monday didn”t extend higher, nor was it required to since Friday”s drop already fulfilled the minimum unfinished business below, and the breakout wasn”t confirmed.
Crude Oil Mar Contract (CL, ETF: (USO, UWTI))
Monday”s gap up retested last week”s highs up to 54.00. The rally has likely resumed. Closing back under 51.75 would now reverse momentum back down.
Natural Gas Mar Contract (NG, ETF: (UNG, UNL))
Monday”s narrow ranging didn”t extend Friday”s probe of fresh lows, so its break is not confirmed. Back above 2.70 would signal the trend reversing up.
Backing-and-filling has its limitations.
Still ranging in negative territory.
This morning”s second most bullish scenario — if not already recovering through the open — was to recover after spending the morning backing-and-filling in negative territory. In fact, the morning”s no-bias environment was spent doing just that.
But the setup also should have begun recovering through the noon hour. That wasn”t just optimal, but appropriate. Yet, the noon hour ranged sideways around Friday”s 2050.50 cash session close. And the afternoon”s no-bias environment is probing this morning”s post-open lows down to 2041.00.
None of which changes that there is “unfinished business above” at 2055.75. Which itself doesn”t prevent a deeper detour that at least retests the overnight low. But reversing momentum back up, if credible, should be steep and substantial to compensate for the delay.
Look ahead: Economic Calendar – for Tue Feb 10 2015
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: After the early morning Fed speaker, only one econ report has any market influence. It”s the post-open JOLTS report of job openings, which can be very influential when it is a surprise that contradicts Friday”s payrolls data. Considering Friday”s reaction, JOLTS might be influential just by confirming.
Jeffrey Lacker Speaks — hawk
8:20 AM ET
Redbook
8:55 AM ET
NFIB Small Business Optimism Index
9:00 AM ET
JOLTS
10:00 AM ET
Wholesale Trade
10:00 AM ET
4-Week Bill Auction
11:30 AM ET
3-Yr Note Auction
1:00 PM ET
Second-best-bullish scenario now up to bat.
Morning recovery delayed too long, but the door remains open.
The reaction down from quickly tested 2051.50 tested and retested the 2044.00 bias-down signal as support. Having avoided triggering through 10:15, and having held another test at 10:30, it was likely to define the bias environment”s lower-end.
And it did. Not immediately — not without backing-and-filling that was this morning”s second likeliest bullish scenario — but it held. The bias environment began lapsing at 11:30 with a retest of Friday”s 2050.50 cash session close.
The market is still in negative territory. But there is now “unfinished business above,” the offsetting test of this morning”s 2055.75 bias-up signal. The extra time spent absorbing more selling pressure should convert into a rally through the noon hour.
So, another test of 2044.00 would start to suggest a deeper detour before fulfilling the unfinished business above.