Posts by Rod David
Post-open Review… Digging for dollars.
Backing-and-filling becomes more obvious, hits a vein.
A brief overnight dip had attacked this morning’s 2856.00 bias-down signal. 
It was retraced back to the 2861.25 overnight high. But not for very long, as another dip fell to 2855.00.
Now a very choppy open has triggered “late bias-down,” putting into play its 2851.00 bias-down target. And fresh lows have developed down to 2853.00. Fresh lows compared to pre-10:15, which is pretty reliable confirmation.
Having said that, the trailing bounce limit was violated above 2854.75-2855.75. And a surge is probing fresh post-open highs at 2860.00.
Back under 2857.00 would reinstate downside momentum. Unless the bias environment were exited above its 2864.00 bias-up signal, this morning’s 2851.00 bias-down target will become “unfinished business below.”
Meanwhile, surging from fresh lows to fresh highs seems like something else is developing. A retest of yesterday’s highs under 2864.00 may be underway.
The First Trade & Pre-open Tour Recording… Very little stretch.
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…
The rally seems to be in a stage of relentlessness. Gapping up Tuesday above Monday’s 2853.50 high to 2857.00, and not trending up from within Monday’s range, reflects strong-handed sponsorship. It creates a position of strength. Tuesday’s open attracted more strength as it rallied another 8 points to attack 2864.00. That’s a lot of energy to expend, gapping up and extending, but the position of strength would keep strong-handed sellers away. The open’s rally didn’t resume, but the balance of the session only ranged choppily sideways back down to 2858.00 — still above Monday’s highs.
Overnight action’s new info…
Tuesday afternoon’s choppy range persisted overnight, albeit more narrowly between 2858.00-2861.50. With one exception, breaking lower to 2856.25 into Europe’s opens. But only a brief exception, as the break was recovered back into the range as quickly as it had developed. Now 2861.50 is being attacked.
If, then…
Extending the rally would next target 2873.00 with potential to 2883.00. Probing fresh highs this morning probably wouldn’t tolerate much hesitation in extending — yesterday and now the overnight has done enough backing-and-filling. Hesitating at fresh highs for too long could soon reverse back under overnight lows. Hesitating to probe higher at all could soon reverse back under overnight lows, too. Regardless of how it starts, a dip would be considered only a temporary correction, whether just testing Monday afternoon’s range down to 2851.00-2852.00, or deeper down to 2841.00-2843.00..
First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 above 2858.00 would be unlikely to trigger the 2856.00 bias-down signal at 10:15. Exiting the open under 2861.75 would be unlikely to trigger the 2864.00 bias-up signal.
Morning Bias
| WED morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2864.00 | 2864.00 |
| …would target | 2870.00 | 2870.00 |
| Bias-down: under | 2856.00 | 2856.00 |
| …would target | 2851.00 | 2851.00 |
| Signal status: LATE BIAS-DOWN | . | |
| 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)
Tuesday’s gap up seems to further confirm the rally is in a stage of relentlessness. Not extending higher intraday doesn’t change that, but it does increase near-term vulnerability to a pullback. That said, trending up or gapping up remain likelier.
Trending up probably would have been attracted back down to Monday afternoon’s Symmetrical Triangle, but Tuesday’s gap up above 2854.25-2856.00 broke that attraction. Reacting back down into the Triangle is still possible, but now it would be from a position of strength, and likelier to recover.
Meanwhile, ranging sideways through Tuesday’s noon hour and afternoon formed a lot of overlapping legs. Separately from the gap up, the overlapping legs creates mass that also makes trending away likely to return. So, another position of strength to help recover from dipping back down into Monday afternoon’s range.
Not that Wednesday’s open won’t immediately extend on its way to 2873.00 and higher. But we’ll know the context of a dip if one appears, whether just testing Monday afternoon’s range down to 2851.00-2852.00, or deeper down to 2841.00-2843.00.
More so, thanks to maintaining Tuesday’s gap through the day, gapping down would form an Island. And since Islands were made to be retested, that would just be another position of strength to absorb another pullback.
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))
Gapping up Tuesday from Monday’s new low duplicated the same reversal setup as at the range’s 2-3 prior lows. Extending the reversal becomes less likely with each occurrence, as Tuesday’s post-open dip from 1.1645 resistance wasn’t yet deep enough to signal momentum reversing down. But not immediately extending higher does undermine even a corrective bounce.
Gold Dec Contract (GC, ETF: (GLD))
Tuesday’s open gapped up to 1222.50 resistance, essentially filling the gap back up to Friday’s close. Monday’s 1216.00 opening gap should be filled before any credible recovery, and the trend meanwhile remains down.
Silver Sep Contract (SI, ETF: (SLV))
Dipping overnight to attack the 3-week old opening gap down at 15.25 was recovered into Tuesday’s open, once again failing to complete the outstanding test intraday. The open filled the gap outstanding from Friday’s 15.47 close, allowing a very bearish reaction down Wednesday. Not already exploiting that opportunity at the open would make a bigger bounce likely.
30-year Treasury Sep Contract (US, ETF: (TLT))
Monday’s opening surge above the 143-02 buy signal had been suspiciously slow to develop. Drifting back down overnight increased suspicions, which were confirmed by drifting even lower intraday to attack the 142-18 sell signal.
Crude Oil Sep Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Already rallying overnight out of Monday’s pullback limit test only attacked Monday’s high, and formed only an inside day. But the 68.85 pullback limit held again as support, which is still likely to probe the 70.45 upper-end of last week’s Island, presumably on the way to fulfilling the 71.75 corrective bounce target.
Natural Gas Sep Contract (NG, ETF: (UNG, UNL))
Monday’s recovery from gapping down and probing lower at its open already confirmed what Friday’s break above 2.83 had signaled. Gapping up and trending higher Tuesday to 2.90 confirms 2.93-2.95 remains in-play.