Posts by Rod David
Post-open Review… Holding the void.
Flat open fails to exploit pre-open recovery.
The overnight drop ultimately touched 2917.50 before recovering to open at 2928.00. 
And that soon extended to touch the 2930.75 earlier Globex high through the opening 15 minutes of volatility. Its recovery would have formed a bullish Globex-Flip, but the setup was attempted too late to be relevant.
Meanwhile, the 2928.00-2929.50 range’s resistance wasn’t entirely recovered. What had been “lower prior highs” from above, is now resistance from below. Yesterday’s close within its range at least prevented the intraday drop from reversing the trend back down. But the open didn’t recover it.
The 2925.25 bias-down signal avoided triggering at 10:15. It also avoided being touched by then, so no offsetting test of its bias-up signal is required. However, probing under it after 10:30 is “no-bias trending” that requires being retraced.
In fact, probing under 2925.25 to 2924.00 has snapped back up to fresh post open highs attacking 2932.00. The price action is more evidence that sellers lack sponsorship — at least the pattern remains vulnerable to recovering.
But another failed recovery attempt would make fresh lows likelier. And fresh lows would threaten yesterday’s 2922.50 low, undermining the open’s Isolation setup, and the potential bottom.
The First Trade & Pre-open Tour Recording… Over, or out.
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…
Monday’s gap up to 2934.50 was well above Friday’s 2919.00 close. And above Friday’s 2925.50 high. Also above Thursday 2932.00 high. Wednesday’s 2936.00 high had been probed overnight before finally dipping 6 points to test 2932.00 as support. That late discount attracted reinforcements at the open that quickly extended the rally to 2942.00. The balance of the session trended down nearly 20 points to 2922.50. Positive territory (barely) held which is a lot of selling pressure to expend without gaining traction for the effort. But even attacking Friday’s range let alone touching it suggested that buyers weren’t such strong sponsorship as the overnight and opening surge had suggested. “Lower prior highs” down to 2928.00 were recovered as support through the close. Oversold RSIs at Monday’s low will want to be retested.
Overnight action’s new info…
The selling and downtrending has persisted. Immediately blipping-up to 2930.75 immediately began reversing back down to attack Monday’s lows. First to 2924.00 before midnight, and then to attack 2921.00 into Europe’s opens. Reacting up to the 2925.25 bias-down signal resolved in new lows down to 2917.50. Now its reaction is attacking 2925.25 as resistance. Could yesterday’s close be recovered next?
If, then… (notes to accompany the Tour recording)
That last question could prove pivotal, whether today’s open is back up above yesterday’s 2928.00 cash session close. Just recovering yesterday’s 2922.50 low to form an Isolation setup would still probe Friday’s range intraday, which a rally should be rejecting forcibly as early as possible. Recovering even further overnight to open back above the earlier 2930.75 low would upgrade the Isolation setup into a Globex-flip that adds momentum to recovering this morning. Until then, there’s risk of resuming and extending the slide considerably. “Unfinished business” above would be minimal, as yesterday retraced the prior Friday’s high session by 61.8%, although that’s not optimal. And the high’s gap up remains unfilled. So, ether Monday’s drop is in the process of completing a backing-and-filling pullback, or else gapping down Tuesday under Friday afternoon’s 2915.50 low will be vulnerable to collapse.
First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 under 2923.50 would be likely to trigger the 2925.25 bias-down signal at 10:15. Exiting the open above 2929.50 would be unlikely to trigger bias-down.
Morning Bias
| TUE morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2928.75 | 2933.75 |
| …would target | 2934.75 | 2939.75 |
| Bias-down: under | 2921.25 | 2925.25 |
| …would target | 2914.00 | 2919.00 |
| Signal status: NO-BIAS | . | |
| 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 didn’t trend down entirely. Only for 5 hours after the open into the final hour, from 2942.00 down to 2922.50. Which, by the way, was entirely positive territory — 2-3 ticks above Friday’s futures close and 3-1/2 points above its cash session close. “Lower prior highs” down to 2928.00 held as support through the close, albeit as barely as last week’s closes above 2919.00.
Of course, the rally is undermined somewhat for needing to retrace Friday’s range without having found new buyers any higher. The 2929.25-2930.00 close did hold above Friday’s high, but not Thursday or Wednesday’s higher highs, which were probed already through Monday’s open. And oversold RSIs at Monday’s low will want to be retested.
The prior Friday’s high session was retraced by 61.8%, which can serve by proxy to retest the high, although it’s not optimal. And the high’s gap up remains unfilled. Either Monday’s drop is in the process of completing a backing-and-filling pullback, or else gapping open Tuesday under Friday afternoon’s 2915.50 low will be vulnerable to collapse.
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))
Friday’s gap down to 1.1650 had bounced into the afternoon. Monday morning slid back down to retest Friday’s gap down. Closing under it would fulfill the minimum requirement for at least an eventual third lower close that was put into play by Thursday’s confirmed breakout.
Gold Dec Contract (GC, ETF: (GLD))
Opening at or under the 1195.00 bounce limit Monday and not closing back above it keeps alive downside momentum targeting at least 1172.50.
Silver Dec Contract (SI, ETF: (SLV))
Already dipping Sunday night from Friday’s attack on 14.80, Monday’s open at the prior target of 14.55 slid through the morning to test last Wednesday’s 14.40 close. There is no currently active signal.
30-year Treasury Dec Contract (US, ETF: (TLT))
Gapping down Monday to the 140-10 sell signal and consolidating under it throughout the session could be confirmed by a second consecutive lower close on Tuesday. Otherwise, the likely alternative is to gap back up and resume the corrective bounce with potential to 141-16.
Crude Oil Nov Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Trending up sharply Monday rallied through the 73.90-74.25 target to test 75.10. The next higher target in-play is 80.80, which would be confirmed by a second consecutive higher close on Tuesday, so long as pullbacks now hold 73.90 as support.
Natural Gas Nov Contract (NG, ETF: (UNG, UNL))
Friday’s dip to the 3.00 pullback limit was rejected by gapping back up to and through Thursday’s 3.06 close and trending up to Thursday’s 3.11 high. The trend remains up, but the pullback limit is now 3.02.