Posts by Rod David
Morning Bias
| WED morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2816.75 | 2819.50 |
| …would target | 2824.00 | 2826.75 |
| Bias-down: under | 2800.25 | 2803.00 |
| …would target | 2792.25 | 2795.00 |
| Signal status: BIAS-DOWN, TARGET MET | . | |
| 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)
Monday’s late-afternoon slide had broken under the uptrending support of an Ascending Triangle pattern we were tracking. The relentless 28-point overnight rally greeted Tuesday’s open back at the broken uptrending support, and extended higher to reject its interim break.
The open had one chance to reject the overnight rally, but the opening 15 minutes of volatility held the 2773.00 open. Extending higher through that window would have been optimal, but hovering pessimistically short of Monday’s 2779.00 highs was bullish enough.
Apparently. The balance of the session trended up relentlessly, adding 36 points to 2816.00. Even a very last-minute pullback to 2808.00 was recovered through the futures close to 2919.00. That’s 64 points above the overnight low.
That’s also the lower-end of 2919.00-2923.00 resistance from a Running Correction that had formed during last Wednesday afternoon’s decline. The next higher resistance is 2838.00 “higher prior lows” from that morning’s consolidation. One or both is likely to be met if Wednesday’s open isn’t greeted by already reversing back under Tuesday afternoon’s 2808.00 bias environment highs.
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))
Last week’s 1.1655 highs were probed again Tuesday, and held again as resistance. While this is the intraday requirement to maintain that a top is forming, the pattern can’t repeat indefinitely before reversing down, not if reversing down is the intent.
Gold Dec Contract (GC, ETF: (GLD))
Monday’s reaction down from the lower-end of 1236.00-1241.00 was recovered entirely Tuesday, still having room to test the target area’s upper-end, but now being vulnerable to reversing or at least correcting last week’s surge.
Silver Dec Contract (SI, ETF: (SLV))
Gapping up Tuesday above Monday’s 14.80 high was reversed back into negative territory to test Monday’s 14.70 close. The gap up is not outstanding and doesn’t require being filled, so early weakness Wednesday would be credible for extending down.
30-year Treasury Dec Contract (US, ETF: (TLT))
Tuesday was the third consecutive session to fluctuate narrowly supported by the 138-04 sell signal. Delaying its break does open the door wider to extending the corrective bounce, which would next be attracted to “higher prior lows” at 140-26.
Crude Oil Nov Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Flat-to-higher ranging for a third consecutive session Tuesday continued to delay the requirement for at least one eventual lower close. The delay keeps the door open to an initially favorable knee-jerk reaction to Wednesday’s EIA, but the news is otherwise being greeted from a position of weakness.
Natural Gas Nov Contract (NG, ETF: (UNG, UNL))
Filling the gap back up to 3.28 was likely before continuing to trigger and confirm the 3.25 sell signal. Probing it overnight up to 3.31 was already retraced before Tuesday’s open to avoid neutralizing the attraction. Narrow sideways ranging Wednesday, too, would greet Thursday’s EIA report from a position of strength.
Mid-day Update… Easy peasy. (Translation: Don’t get comfy.)
Relentless intraday trending is good, complacency is not.
The morning bias environment eventually probed its 2783.25 pre-10:15 high to confirm its doubly renewed bias-up signal remained intact. The window lapsed at 2796.00, and the noon hour was exited slightly higher at 2797.50.
That’s this afternoon’s bias-up signal, and it was overlapped from 1:20 until 2 minuted prior to 1:30. That was just in time to trigger “late bias-up.” Extending higher has already touched this afternoon’s 2803.00 bias-up target.
This is still a bias-up environment, so the window can extend even higher to 2808.00. We’ll watch the bias environment’s exit for signals of any vulnerability to reversing down. There’s no requirement at this stage to resolve in either direction.
Look ahead: Economic Calendar – for Wed Oct 17, 2018
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: Canada legalizes recreational cannabis on Wednesday. Meanwhile, the FOMC Minutes release is likely to be more influential to price action than usual since rate hikes are attributed as one cause to the recent stock market plunge.
MBA Mortgage Applications
7:00 AM ET
Housing Starts
8:30 AM ET
EIA Petroleum Status Report
10:30 AM ET
*FOMC Minutes
2:00 PM ET