Posts by Rod David
The First Trade & Pre-open Tour Recording… More than compensating for the delay.
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…
Thursday’s similarity to Wednesday — not so much in form as in function — continued the behavior as if lost in the Bermuda Triangle. The morning’s late no-bias signal left its 2866.25 target outstanding. The afternoon’s noN-bias fluctuated narrowly and couldn’t sustain its attack on session highs. Those are similar in function, reflecting weak-handed sponsorship on both sides. The final minutes repeated Wednesday’s late plunge back to session lows. Wednesday’s “unfinished business below” at 2852.00 was almost met.
Overnight action’s new info…
The ongoing inability to rally was likely due to the 2852.00 unfinished business below. And probing under it down to 2841.00-2843.00 to compensate for the delay had become likely. Thursday night’s slide immediately fulfilled 2852.00, and then kept grinding lower to attack 2848.00. Breaking sharply lower extended to 2839.00 into Europe’s opens. Ranging sideways back up to 2844.00. An overnight measurement to 2838.00 was finally fulfilled down to 2836.75, and now 2841.00-2843.00 is being tested as resistance.
If, then…
An Isolation setup is probably off the table. The overnight test of lower attractions should be threatening Thursday’s lows by now. Testing and holding 2841.00-2843.00 through the open could at least start forming a low. A bigger bounce from gapping down would likely dip from 2851.00-2852.00 to back-and-fill before a durable recovery. Post-open selling at some point is almost required, to let the intraday crowed express what the overnight crowd has been doing all night.
First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 under 2843.00 would be likely also not to recover the 2846.00 bias-down target by 10:15, which would renew the bias-down signal. Exiting the open under 2848.00 would be likely at least to trigger the 2851.00 bias-down signal at 10:15.
Morning Bias
| FRI morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2857.25 | 2857.50 |
| …would target | 2862.75 | 2863.00 |
| Bias-down: under | 2851.00 | 2851.50 |
| …would target | 2845.50 | 2846.00 |
| Signal status: BIAS-DOWN, BIAS-DOWN TARGET EXCEEDED | . | |
| 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)
Thursday looked awfully familiar to Wednesday. Not necessarily in form, although another late plunge returned to the lows. More so in function, as the ranging above Monday’s highs persisted, a new bias objective was left outstanding, and the most influential bias was the afternoon’s noN-bias.
Thursday morning’s bias-own signal held its test to trigger late no-bias, but the offsetting test of its
2866.25 bias-up signal was attacked only to 2862.75. So, “unfinished business above” at 2866.25. That’s competing with Wednesday’s unfinished business below at 2852.00, which is likely to be probed down to 2841.00-2843.00.
Wednesday and Thursday’s late plunges help to confirm the downside objective must be resolved before resuming the rally, and gapping up to resume it is less likely. Neither 2852.00 nor 2843.00 must be tested intraday to be neutralized. Isolating one or both to the overnight and opening back within Thursday’s range could already reverse momentum up.
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))
Wednesday’s bounce back to Tuesday’s highs attacking overnight highs was already retracing to gap down Thursday back at Wednesday’s 1.1615 open. Which was also the sell signal. And the overnight retracement extended down sharply through the noon hour to Monday’s internal support at 1.1580. But our premise is that the false bounce will be punished by much more than just retracing its origin.
Gold Dec Contract (GC, ETF: (GLD))
Although there’s no longer any “unfinished business below,” a close above 1229.50 will be needed to avoid fresh lows down to 1201.50.
Silver Sep Contract (SI, ETF: (SLV))
Thursday’s flat-to-higher ranging was too meek to offset the outstanding attraction back down to 15.25, whose delay is increasingly likely to require a deeper probe. Gapping up or otherwise surging through 15.60 would get some benefit of the doubt for staging a detour higher.
30-year Treasury Sep Contract (US, ETF: (TLT))
Still hovering around the 142-18 sell signal at Thursday’s open didn’t qualify as triggering it, but neither did it reject the break back under 143-02. Nevertheless, firming Thursday retested 143-02 and the 143-12 buy signal as resistance. Not extending higher Friday would all but require fresh lows.
Crude Oil Sep Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Wednesday’s plunge only consolidated Thursday, which leaves potential for extending down, but doesn’t require it. There is no active signal.
Natural Gas Sep Contract (NG, ETF: (UNG, UNL))
Thursday’s knee-jerk reaction to the EIA report could have been down, but only temporarily. The news was greeted from a the position of strength of new highs, but new highs that had just fulfilled their 2.93-2.95 target. The reaction was actually muted, as the session fluctuated narrowly within the target range.
Mid-day Update… Triangu-strangu-lation.
More weirdness.
This morning’s late bias-up attacked 2863.00 at its height. But it was already retracing to 2859.00 when the bias environment began lapsing at 11:30. And then it plunged to attack 2855.00 by noon. That’s a fresh post-open low.
Reversal? Not any more so than the noon hour’s bounce that has extended to attack 2863.00. And that was after invoking another grace period, that wasn’t resolved by 1:30.
So, the Bermuda Triangle persists. Until it doesn’t. But there’s an app for that — several. Some of the higher profile are Narrow Range patterns (NR4 and NR7), and Bollinger Bands. They’re predicated on the historical reality that: nothing lasts forever, but when it seems like forever, they end abruptly.
My methodologies incorporate these applications indirectly. And I can say that we should be prepared, and not at all surprised, when this range explodes, too. But that’s not to say it’s a contained explosion, especially not with competing “unfinished business” both above and below at 2851.00 and 2866.25.