Posts by Rod David
Mid-day Update… False bravado.
Bias-down rally underway.
This afternoon’s bias-down triggered under 2699.25. Its 2691.00 target was met already to within 3 ticks during the noon hour. It’s still an objective, but won’t become “unfinished business” if left outstanding.
Fresh lows through the bottom of the hour would have reinforced the bias-down. Back above the 2699.25 bias-up signal through the bottom of the hour would have invalidated the bias-down. Neither happened.
Regardless, this pattern has potential for a bias-down rally anyway. Which seems to be developing, now probing fresh session highs up to 2708.00. Trending above the bias-down signal during a bias-down environment is sponsored by weak hands, and doomed to failure.
The bias-down rally’s objective remains 2715.50, and the likely resolution is the same as at this morning’s test of 2695.00-2697.00 — to reverse back down. Retesting 2699.25 and then extending higher would no longer be sponsored by weak hands.
Look ahead: Economic Calendar – for Fri Oct 26, 2018
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: REMINDER: I’m away from the screens all morning Friday, after recording the Market Tour — back in the afternoon… Meanwhile, Friday’s pre-open GDP is only high-profile, but any noticeable reaction to its report is likely to be duplicated by the post-open Consumer Sentiment.
GDP
8:30 AM ET
*Consumer Sentiment
10:00 AM ET
Baker-Hughes Rig Count
1:00 PM ET
Afternoon Bias
| THU afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 2709.00 | 2709.00 |
| …would target | 2718.00 | 2718.00 |
| Bias-down: under | 2699.00 | 2699.25 |
| …would target | 2690.75 | 2691.00 |
| Signal status: BIAS-DOWN | . | |
| NEW: BIAS VIDEOS… INTRO // EXAMPLE | ||
1. At 1:20, 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 1:20 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 1:20 would invoke a grace period through 1:30 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 1:30 after invoking the grace period would trigger “noN-bias,” with no bias influence.
Post-open Review… Dragging it up just to drag it out.
Post-open rally neutralizes higher resistance.
The overnight rally to 2692.25 was retraced ultimately to 2673.00. 
It’s pre-open bounce greeted the open at this morning’s 2679.25 bias-up target, and then dipped again to 2667.75.
And the low was in.
Just having absorbed the pre-open dip had suggested already the overnight high would be probed up to 2695.00-2697.00. Their test reacted down to 2683.00, and is bouncing again. Just exceeding the 2695.00-2697.00 target suggests the next higher objective is 2715.50. Price is now trying to saw its way through to 2700.00.
Or, else, the high is in.
RSIs are diverging negatively. The sawing is still overlapping 2695.00-2697.00, and not yet trending above it. Back under 2688.75 would start to signal momentum reversing down. The 2679.25 and 2671.00 bias-up parameters would be likely objectives until the bias environment begins lapsing to allow even lower.
The First Trade & Pre-open Tour Recording… Another shoe?
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…
A 30-point overnight pullback down to 2720.00 had bounced 26 points back up to 2746.00 before Wednesday’s open. That was sufficient to extend higher, but it didn’t. The overnight lows were retested, and probed down to 2704.00 before the morning bias environment began lapsing. Its 26-point bounce also resolved down going into the afternoon bias environment, and plunged coming out of it. The last minute’s 2652.25 low bounced 20 points to 2672.25 before the futures close. That’s 104 points under Tuesday afternoon’s highs. The two next lower objectives were neutralized at 2671.00 and 2663.75. The next lower objective was put into play at 2637.25.
Overnight action’s new info…
Wide and choppy sideways ranging persisted well through midnight. An earlier dip to 2659.00 was recovered to 2677.50, which was retraced back into the range around unchanged. Europe’s reaction to yesterday’s plunge was easily absorbed, and the relief soon launched a break higher to 2692.50. Its touch of yesterday afternoon’s bias environment “higher prior low” has reacted down 10 points.
If, then… (notes to accompany the Tour recording)
The current break higher has reacted down from barely touching yesterday afternoon’s bias environment “higher prior low” at 2692.50. My next cluster of resistance lies just above it at 2695.00-2697.00. Overnight action never requires a retracement, but it’s still likely so long as no pre-open downdraft has yet developed. I would consider selling that downdraft it appears before extending up to 2695.00-2697.00 or to 2715.50, either of which would be vulnerable to launching another downleg that resumes the decline. The ECB and Mario Draghi will be painting the headlines soon, along with more quarterly earnings releases, and then several econ reports at 8:30.
First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 above 2686.00 would be likely also to exceed the 2679.00 bias-up target at 10:15 to renew the bias-up signal. Exiting the open above 2674.00 would be at least likely to trigger the 2671.00 bias-up signal at 10:00. Exiting the open under 2666.00 would be unlikely to trigger bias-up.