Posts by Rod David
Morning bias
| THU morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2044.25 | 2038.25 |
| …would target | 2050.50 | 2044.50 |
| Bias-down: under | 2031.50 | 2025.50 |
| …would target | 2025.00 | 2019.00 |
| Signal status: BIAS-UP, BIAS-UP TARGET EXCEEDED | 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.
Pushing on silly string.
Choppy ranging is looking for a trigger.
This afternoon”s no-bias environment held a retest of the noon hour”s 2036.00 low, and bounced back to its 2042.50 high. That”s a range, but not much of one.
The bias environment”s 2:30 exit and the final hour”s 3:00 entry both were within the noon hour”s range. There is no momentum.
Trading out the session in this range is possible without there being any attraction in-play either above or below. Trending up above 2042.50 through the 3:10-3:20 timing window would be credible for extending higher into the close only.
Back under 2038.25 could start trending down instead. But it wouldn”t be credible without probing under 2036.00 by 3:20, or at least before the position-squaring window opens at 3:37.
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))
Wednesday”s dip to 1.1400 can suffice as a pullback limit after Tuesday already confirmed Monday”s breakout. But any follow-on weakness Thursday morning should be recovered and reversed up into the close instead of gaining traction.
Gold Apr Contract (GC, ETF: (GLD))
Tuesday”s drop didn”t extend down Wednesday, which gapped up a little Wednesday but reversed back down from testing 1272.50 resistance. Fresh lows remain likely.
Silver Mar Contract (SI, ETF: (SLV))
Firming Wednesday after the recent lack of volatility doesn”t endorse the bounce as necessarily extending. The noise is still likely to resolve down.
30-year Treasury Mar Contract (US, ETF: (TLT))
Gapping down Wednesday and extending down to 148-18 tried confirming Tuesday”s break under the 149-14 sell signal. But its recovery back into positive territory above 149-14 undermines the drop, and leaves the door open to backing-and-filling up to 150-12 and 150-26.
Crude Oil Mar Contract (CL, ETF: (USO, UWTI))
Tuesday”s surge through 54.00 obviously got very much ahead of itself, as Wednesday”s reaction fell back to the 48.00 buy signal. It might even extend down to 47.35, which would be almost too deep to reverse the trend down. Back above 49.95 would resume the rally.
Natural Gas Mar Contract (NG, ETF: (UNG, UNL))
Wednesday”s dip avoided confirming Tuesday”s breakout, which prevents greeting Thursday”s EIA report from a position of strength. Bottoming potential remains intact, but not yet triggered.
Look ahead: Economic Calendar – for Thu Feb 5 2015
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: Thursday”s Jobless Claims hasn”t been very influential for awhile, but always has a higher-profile during NFP week. Challenger”s report for some reason has little effect. Meanwhile, the BOE”s monthly policy statement tends not to influence price action. That migh change now that it won”t share its spotlight with ECB which has gone to a 6-week schedule.
Eric Rosengren Speaks — dove
5:00 AM ET
*Bank of England monetary statement
noon local time
Challenger Job-Cut Report
7:30 AM ET
Gallup US Payroll to Population
8:30 AM ET
International Trade
8:30 AM ET
*Jobless Claims
8:30 AM ET
Productivity and Costs
8:30 AM ET
Bloomberg Consumer Comfort Index
9:45 AM ET
EIA Natural Gas Report
10:30 AM ET
Treasury STRIPS
3:00 PM ET
Fed Balance Sheet
4:30 PM ET
Money Supply
4:30 PM ET
Down is difficult, but it’s the only alternative.
Gap down absorbed entirely. And then completely.
This morning”s premise was that the overnight drop would be recovered, and the rally would resume. The 2035.25 bias-down signal held its test through 10:15, putting into play an offsetting test of the 2046.25 bias-up signal.
It wasn”t a straight shot. An early surge to almost 2043.00 had reacted down 10 points, back under the bias-down signal to 2033.25. But it was too late to trigger, or to invalidate what had triggered already at 10:15.
The balance of the morning extended higher until touching 2046.25.
Price action since then has dipped to 2039.50. If this is only a corrective dip, then a retest of prior highs today remains possible, if not tomorrow. Otherwise, the dip can become a problem. First, there is no “unfinished business above” — nothing generated by this current rally leg. Second, any lower would start to trigger a sell signal. And a sell signal at this stage could still reverse the trend down.
Back above 2043.00 would start to signal the dip was only corrective, and that it is done.