Posts by Rod David
The First Trade & Pre-open Tour Recording… Weekend Wrally.
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…
Overnight ranging up to 2849.00 and down to 2835.00 greeted Friday’s open toward the range’s lower-end. The open’s range was much narrower than overnight, but also noncommittal in either direction. But touching 2835.00 again finally started a rally that would extend into noon up to 2848.00. Reacting down 7 points to 2841.00 through the noon hour was reversed up by the bullish WedEX influence up to 2857.00. The prior week’s “higher prior lows” at 2854.00-2855.00 held as resistance through the close. But the rally still gained traction for its efforts by the bias environment exit and final hour’s entry both exceeding their prior timing window highs.
Overnight action’s new info…
Friday’s support has persisted overnight. Its last reaction down had tested 2850.50, and firming from there extended at Sunday night’s open to 2855.00. Its reaction down tested 2850.50 before midnight, as did another, shallower bounce’s reaction down after midnight. A break lower seemed imminent, but it was circumvented by Chinese government intervention. Surging into and out of Europe’s opens probed Friday’s high by 3 points up to 2860.00. Now its reaction down is testing Friday’s high as support down to 2856.00.
If, then…
Trend extremes aren’t associated with expirations. So, an unlikely collapse today would likely be brief and recover entirely. Anyway, the first likelihood is to probe higher highs this morning since Friday’s rally gained traction. Even despite NDX underperforming S&Ps, and more so the Dow for a second consecutive session Friday, the market certainly seems like it wants to trend higher, at least in the near-term. There’s also follow-through from the bullish WedEX. And having peaked Friday upon testing “higher prior lows” from the prior week’s 2854.00-2863.00 consolidation, extending higher out of the weekend is likely to gap up to and/or trend through its upper-end. The overnight high has retraced that range already to 61.8%, so any higher would all but confirm the 2854.00-2863.00 consolidation’s complete recovery underway.
First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 under 2852.00 would be unlikely to trigger the 2854.50 bias-up signal at 10:15. Exiting the open above 2857.00 would be likely to trigger bias-up.
Morning Bias
| MON morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2853.50 | 2854.50 |
| …would target | 2860.75 | 2861.75 |
| Bias-down: under | 2846.50 | 2847.50 |
| …would target | 2840.00 | 2841.00 |
| Signal status: noN-BIAS, STILL TESTING BIAS-UP SIGNAL | . | |
| 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)
Friday’s bullish WedEX influence wasn’t responsible for the morning’s rally from its post-open dip to 2835.00, back up to 2848.25. 
The post-open dip to 2835.00 not triggering the 2836.75 bias-down signal enabled that reaction, despite not being a requirement.
After entering the afternoon’s bias environment on a pullback to 2841.00, recovering above 2844.50 would have fulfilled the bullish WedEX influence. Extending to fresh highs at 2857.00 was not a requirement.
The market certainly seems like it wants to trend higher. Especially when it trends higher than its setup requires. Also when it trends up despite a seemingly bearish sentiment. A lot of the latter is a reflected in FAANGs and NDX underperforming S&Ps, and more so the Dow, for a second consecutive session. That’s usually bearish in the near-term.
But probably too near, since expirations aren’t usually associated with trend extremes. Collapsing out of the weekend would likely recover quickly. And having peaked Friday upon testing “higher prior lows” from the prior week’s 2854.00-2863.00 consolidation, extending higher out of the weekend would likely gap up to and/or through its upper-end.
Details and other markets coverage are discussed in the post-market Wrap recording here.
THERE IS NO SATURDAY REVIEW THIS WEEKEND… BIGGER PICTURE WAS REVIEWED IN THE MARKET WRAP VIDEO.
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))
Closing Thursday at the 1.1385 buy signal had tried extending higher overnight. Its retest into Friday’s open also reacted up intraday.
Gold Dec Contract (GC, ETF: (GLD))
Friday’s relatively narrow ranging didn’t create any new setups into the weekend, suggesting that Sunday night or Monday is vulnerable to attacking or event to retesting Wednesday night’s 1167.00 low.
Silver Sep Contract (SI, ETF: (SLV))
Ranging narrowly Friday around unchanged keeps alive the attraction back down to Wednesday’s low, at least to 14.45 before a rally would be reliable for extending.
30-year Treasury Sep Contract (US, ETF: (TLT))
Gapping up slightly Friday extended to probe a fresh high. It didn’t extend, and formed “ineffectual optimism” that is vulnerable to reversing down on Monday. But the week’s favorable performance follows the prior Friday’s fresh relative high close, suggesting a more substantial rally is underway.
Crude Oil Sep Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Flat-to-higher ranging Thursday was essentially duplicated overnight, gapping up Friday to test the 66.10 buy signal. Its test held, reacting down to fill the gap back to Thursday’s close and neutralize its attraction below. The buy signal remains intact.
Natural Gas Sep Contract (NG, ETF: (UNG, UNL))
Gapping up Friday into the rally’s 2.93-2.95 target area was premature for resuming the rally, and also too shallow to suggest momentum had reversed up. A fresh pullback low remains likely.
Mid-day Update… Holding up.
Morning rally not rejected.
This morning’s 2836.75 bias-down signal was still being tested at both 10:15 and 10:30 to trigger noN-bias. This often behaves like a no-bias without any objective in-play. This morning’s behaved as if the bias-down signal did hold its test cleanly, and rallied to within 1 tick of its 2848.50 bias-up signal.
A dip into the noon hour to 2842.25 is being probed by another point now, after already triggering no-bias for this afternoon. If also tested, the 2840.00 bias-down signal should define the window’s lower-end.
Back above 2844.25 would start to signal momentum reversing up. Similar to the bias-down signal’s constraint that I just described, there’s room up to the 2850.50 bias-up signal until the no-bias environment starts lapsing. The afternoon’s bullish WedEX can work with that.