Posts by Rod David
Market Wrap (recording & summary)
Thursday morning’s rally was likely to test 2841.00, potentially extend to 2846.00, and then probably correct. The rally tested 2846.00, extended to 2852.00, and then corrected. Perhaps the morning’s extra upside is responsible for a lack of afternoon buyers to resume the rally. Its correction down to 2838.50 was rejected by a last-minute surge through the close attacking 2846.00.
Even without the last-minute surge, Thursday’s prevailing uptrend wasn’t reversed by the afternoon’s downtrend of lower lows and lower highs. Neither did it resume. And buyers didn’t gain traction for the morning’s effort, since neither the bias environment exit nor the final hour’s entry recovered a prior high. So, trending higher without delay Friday all but requires gapping up, optimally above the afternoon’s 2849.50 high.
Thursday afternoon’s sellers also didn’t gain traction for their effort, since exiting the bias environment under the noon hour’s low was never confirmed by another window. But positive territory puts the burden of proof on buyers, so Friday morning (if not already overnight) could extend Thursday afternoon’s decline. Under 2835.50 could test 2826.00 before being unlikely to recover.
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 Sep Contract (EC, ETF: (FXE, UUP))
Having neutralized the open’s gap down before closing positive Wednesday, the recovery attempt was free to extend at anytime Thursday. Overnight action did probe above the 1.1385 buy signal, which intraday action still tested as support.
Gold Dec Contract (GC, ETF: (GLD))
The 4-day sequence through Wednesday’s third day had indicated Thursday would likely close positive. The $18 overnight drop to 1167.00 benefited most from the influence, essentially forcing a recovery back above Wednesday’s 1185.00 close. The sequence can repeat indefinitely, so the trend reversal signal remains at 1194.70.
Silver Sep Contract (SI, ETF: (SLV))
A slightly lower low overnight testing 14.32 was easily recovered to gap up Thursday and extend to 14.80. At least a dip down to 14.45 is likely before a more durable rally can begin. That said, an attraction down to the low can be delayed by a bigger bounce anyway, just not by a reliable bounce.
30-year Treasury Sep Contract (US, ETF: (TLT))
Resolving the two-day consolidation under Friday’s high to finally probe higher Wednesday was never extended overnight. Thursday’s open back under Friday’s high was extended back into the interim range, still not signaling a resolution either way.
Crude Oil Sep Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Ranging flat-to-higher Thursday stopped short of attacking the 66.10 buy signal, meanwhile leaving the decline vulnerable to extending down.
Natural Gas Sep Contract (NG, ETF: (UNG, UNL))
Greeting Thursday’s EIA report from a position of weakness enabled a negative knee-jerk reaction to the news that took price into negative territory. Another lower low has room down to 2.85 while still being able to recover.
Mid-day Update… More function than form.
Target area now being used as support.
The likely upside objective this morning was to fill the gap back up to Tuesday’s 2841.00 close. 
The likely resolution was to extend almost relentlessly and probe the 2843.50 upper-end of Tuesday’s late consolidation that contained that gap. Finally, expending so much energy to exceed so much resistance was likely to correct back down.
That initially relentless upside’s objective? 2844.50-2846.00. But testing it as resistance only consolidated, and then surged higher to attack 2852.00. But the pattern’s form was maintained, and the single leg of relentless follow-through did correct — but only down into the 2844.50-2846.00 range.
The follow-through expended excess buying pressure, but its reaction down can still be a temporary correction. It gets more difficult to avoid reversing the trend down if the correction can’t hold a test of 2842.00. And it gets to be bearish under 2835.50.
Meanwhile, already no longer hugging this afternoon’s 2848.00 bias-up signal, exiting the noN-bias environment should start trending toward the next resolution — either back down into yesterday’s range at 2811.00 or 2802.00, or on the way back up to and through last week’s 2863.50 highs.
Look ahead: Economic Calendar – for Fri Aug 17, 2018
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: Two high-profile report are released simultaneously (with a third) after Friday’s open, and both are reliably influential to price action.
*Consumer Sentiment
10:00 AM ET
E-Commerce Retail Sales
10:00 AM ET
*Leading Indicators
10:00 AM ET
Baker-Hughes Rig Count
1:00 PM ET
Afternoon Bias
| THU afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 2847.00 | 2848.00 |
| …would target | 2853.00 | 2854.00 |
| Bias-down: under | 2841.75 | 2843.00 |
| …would target | 2836.25 | 2837.50 |
| Signal status: noN-BIAS, STILL TESTING BIAS-UP SIGNAL | . | |
| 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.