Posts by Rod David
Look ahead: Economic Calendar – for Wed Sep 26, 2018
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: As if the FOMC policy statement wasn’t exciting enough, the quarterly Fed Chair’s Q&A follows it. One and the other are the two most opportunistic trading environment for my measurements, because their setups tend to play–out very quickly.
MBA Mortgage Applications
7:00 AM ET
New Home Sales
10:00 AM ET
EIA Petroleum Status Report
10:30 AM ET
*FOMC Meeting Announcement
2:00 PM ET
FOMC Forecasts
2:00 PM ET
*Fed Chair Press Conference
2:30 PM ET
Afternoon Bias
| TUE afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 2926.50 | 2931.25 |
| …would target | 2933.00 | 2937.75 |
| Bias-down: under | 2918.50 | 2923.50 |
| …would target | 2913.50 | 2918.50 |
| Signal status: LATE 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… Aaaand, it’s off.
Pre-open rally fizzles.
Yesterday afternoon’s bounce gained no traction for its effort. So, immediately extending the rally today required gapping up above yesterday’s highs. Rallying overnight to test 2934.00 created a 5-point margin.
Not enough.
The open was greeted just 2 ticks under yesterday’s morning’s 2929.50 high. Immediately rallying from there still would have been credible, but the pre-open dip extended down to 2924.00. This morning is a no-bias environment.
The 2930.50 bias-up signal wasn’t touched post-open, so it wasn’t actually rejected, so no offsetting test of the 2921.25 bias-down signal is in-play. Either signal should hold if tested this morning.
Lower lows aren’t required, but there’s room for noise down to 2921.25 which must hold 2919.00 to avoid anything more substantial. Back above 2927.75 would start to signal another rally effort underway, albeit probably limited until the afternoon bias environment starts lapsing.
The First Trade & Pre-open Tour Recording… It’s on.
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 was paralyzed by anxiousness. The session was caught between two external inputs: China tariffs going into effect triggered a gap down to 2930.00 Sunday night, and fear for a response kept the overnight range trapped between 2925.00-2930.00. Post-open action quickly tested relevant supports at 2921.25 and 2919.00. Political intrigue triggered a blip-down to test 2918.00 that was otherwise irrelevant, and quickly absorbed. Ultimately, intraday selling pressure didn’t extend, but neither was it reversed, as bounces kept probing back above the 2925.00 overnight lows. The afternoon’s bounce missed a couple of setups to gain traction, and no new “unfinished business” was left outstanding.
Overnight action’s new info…
Monday’s recovery back above 2925.00 initially ranged flat-to-lower from the Globex open. Recovering into Europe’s opens extended steadily back up to Sunday night’s 2930.00 highs, and to this morning’s 2930.50 bias-up signal. Suddenly, price is surging back up above Friday’s lows to test 2933.50.
If, then… (notes to accompany the Tour recording)
Having failed to gain traction Monday afternoon, rallying Tuesday morning all but requires gapping up. And being likely to rally, this morning was likely to gap up. Overnight action is certainly trying, but it must still negotiate Friday’s “higher prior lows,” and of course this morning’s bias-up signal. Otherwise, another intraday dip is possible while still being likely to recover last week’s highs — perhaps to “lower prior highs” at 2914.00 — so long as 2919.00 recovers through the window that probes it.
First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 above 2932.50 would be likely to trigger the 2930.50 bias-up signal at 10:15. Exiting the open under 2927.75 would be unlikely to trigger bias-up.
Morning Bias
| TUE morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2925.50 | 2930.50 |
| …would target | 2931.00 | 2936.00 |
| Bias-down: under | 2916.25 | 2921.25 |
| …would target | 2910.50 | 2915.50 |
| 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.