Posts by Rod David
Morning Bias
| MON morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2881.00 | 2881.50 |
| …would target | 2886.25 | 2886.75 |
| Bias-down: under | 2870.50 | 2871.00 |
| …would target | 2864.25 | 2864.75 |
| Signal status: NO-BIAS, TESTED BOTH BIAS-UP PARAMETERS | . | |
| 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)
The short-squeeze for Friday afternoon was never actually confirmed by recovering 2884.50 into the noon hour. The bias window’s exit had touched 2884.50, only for a reaction down to 2877.00 to try resuming the rally. The reaction down failed, instead inflecting down under 2877.00 in a knee-jerk reaction down to tariff headlines that tested 2868.00.
Unfinished business above at 2886.75, 2892.25 and 2895.50 would have to wait. Buyers gained no traction for their efforts Friday afternoon, which really should have been evident during the same noon hour window that had reacted down. Gapping up Monday above Friday’s 2884.50 high would serve by proxy, just like gapping up Friday above Thursday’s 2893.00 would have served by proxy.
Meanwhile, a recovery needs to find buyers at lower levels. There is potential down to 2857.00, if not a likelihood for having closed under Wednesday’s 2877.50 low. A corrective bounce up to 2879.75-2881.50 can’t be dismissed, and must hold to maintain the near-term downside potential.
Details and other markets coverage are discussed in the post-market Wrap recording here.
NO SATURDAY REVIEW DUE TO TRAVEL, ENJOY THE WEEKEND!
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 Sep Contract (EC, ETF: (FXE, UUP))
Dipping again on Friday suggests the 2-day bounce has held its resistance, but the dip wasn’t yet deep enough to confirm downside momentum is reinstated and that lower targets are back in-play.
Gold Dec Contract (GC, ETF: (GLD))
Firming both before Friday morning’s payrolls report and after it were each rejected by reactions down. Which is how the afternoon was entered, ready to resume the decline next targeting an intraday retest of at least 1272.50.
Silver Dec Contract (SI, ETF: (SLV))
Flat-to-higher ranging both before and after Friday morning’s payrolls report apparently absorbed the reactions without triggering a buy signal. Almost any immediate buying pressure coming out of the weekend would be credible for reversing the downtrend that targets fresh lows.
30-year Treasury Dec Contract (US, ETF: (TLT))
Friday’s Employment Situation report was greeted from a position of weakness for still testing its 143-18 sell signal, or at least not from a position of strength above its 143-26 buy signal that was only attacked Thursday. The reaction was to gap down and probe under prior lows down to 142-12. Fresh lows into a weekend are difficult to reverse without first following-through.
Crude Oil Oct Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Overnight firming didn’t persist into Friday’s session, which ranged sideways back down to Thursday’s 67.00 low, and under the 68.40 buy signal.
Natural Gas Oct Contract (NG, ETF: (UNG, UNL))
Friday’s slightly lower lows into the weekend both confirmed that Thursday’s fresh low close did not completely fulfill downside selling pressure, while also being likely to extend the downtrend coming out of the weekend.
Mid-day Update… Another detour.
Tariff headline derails recovery.
A funny thing happened on the way to an afternoon short-squeeze. The morning’s fresh trend extreme at 2865.00 had been recovered in time to avoid triggering the 2875.25 bias-down signal. And that was after also testing the 2868.75 bias-down target. Offsetting tests of both bias-up parameters were put into play.
But it was still a bias-down environment, so the window needed to be exited back above 2884.50 for confirmation that momentum had reversed up. In fact, 2884.50 was tested as the bias environment began lapsing.
A good effort, and probably on its way to being successful. But it was already retraced down to an inflection point at 2877.00 into the noon hour.Being in proximity to triggering a signal, then rejecting it, is almost tantamount to triggering the opposite signal. At least, the pattern becomes hyper-vulnerable to a reversal, which a tariff headline exploited in a very big way.
Plunging to 2868.00 has ranged sideways back up to 2874.50. This is essentially the afternoon’s 2868.75-2875.00 bias parameters. Bias-down triggered, and its bias-down target is already met. More important, sellers that were almost marginalized are refreshed, while buyers have been trapped ahead of the weekend. Potential down to 2857.00 is only growing.
Look ahead: Economic Calendar – for Mon Sep 10, 2018
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: Monday’s calendar has no econ reports, except for a late-morning Fed speaker, who comes along after Friday Employment Situation report.
*Raphael Bostic Speaks
11:30 AM ET
3-Month Bill Auction
11:30 AM ET
6-Month Bill Auction
11:30 AM ET
TD Ameritrade IMX
12:30 PM ET
Consumer Credit
3:00 PM ET