Posts by Rod David
Look ahead: Economic Calendar – for Thu Aug 2, 2018
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: Thursday’s calendar is busy, and high-profile, but none of its items are reliably influential to price action. The post-open Factory Orders could either reinforce or diverge from Wednesday’s PMI blowout, but its relevance is limited AFTER the FOMC meeting.
Bank of England policy statement
7:00 AM ET
Challenger Job-Cut Report
7:30 AM ET
Jobless Claims
8:30 AM ET
Factory Orders
10:00 AM ET
EIA Natural Gas Report
10:30 AM ET
Fed Balance Sheet
4:30 PM ET
Money Supply
4:30 PM ET
Afternoon Bias
| WED afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 2818.25 | 2818.50 |
| …would target | 2824.00 | 2824.25 |
| Bias-down: under | 2810.75 | 2811.00 |
| …would target | 2804.25 | 2804.50 |
| Signal status: NO-BIAS, TESTED BIAS-DOWN SIGNAL | FAQ | |
| Flowcharts: Bias-UP // Bias-DN INTRO VIDEOS #1 and #2 |
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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.
Post-open Review… Late, too late, strength.
Narrowly ranging open finally breaks higher.
Rallying up to 2821.50 opened only 2 points lower and ranged narrowly, choppily sideways through the first half-hour. Longer, even. The range was persisting at 10:15, away from either bias signal, triggering no-bias.
Then the opening range’s upper-end broke higher to 2825.50. That probed the 2823.25 bias-up signal. But it was too late to trigger, or to invoke the grace period. Exceeding 2823.25 at 10:30 would have invalidated no-bias, but it wasn’t, and it didn’t.
Probing above 2823.25 this morning is no-bias trending that will require being retraced entirely. Exiting the bias environment above its 2831.00 bias-up target would excuse the retrace requirement.
Good luck finding sponsorship. It’s not impossible, but trending higher probably needs a catalyst like a headline. Meanwhile, trending higher will be difficult amid anxiousness ahead of this afternoon’s FOMC policy statement, and through resistance at yesterday’s high.
Back under 2820.75 would start to signal a deeper pullback under, with plenty of room to expend selling pressure before it starts damaging the bottoming potential.
The First Trade & Pre-open Tour Recording… Another spike up retraced.
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…
Tuesday’s open was greeted back up at Monday afternoon’s 2811.25 high. Almost. A headline just minutes before the open triggered a spike up to 2818.50. Where the overnight bounce had threatened unconvincingly to gap up above 2811.25, unconvincingly, the spike up promised deceptively. Neither would qualify for triggering a “session-long rally” setup, and the spike up was retraced back down to the morning’s 2808.50 bias-up signal. Another surge developed into the noon hour up to 2825.00, but its resistance held, too, and the balance of the session drifted lower into the cash session close at 2817.00. Futures bounced to 2824.00. That included a late blip-down to 2813.75 in reaction to another headline.
Overnight action’s new info…
Just closing at or above 2817.00 Tuesday had kept sellers from regaining traction. A hold-long was avoided, but an initially favorable knee-jerk reaction to AAPL’s earnings blipped-up to attack 2828.00. Price had dipped back under Tuesday’s high when news hit of new US tariffs against China. Spiking down pierced Tuesday’s late 2813.00 low by 2 points. Ranging choppily sideways overnight is now retesting 2813.00 as support.
If, then…
Retracing the post-close surge doesn’t yet equate to rejecting it. But exiting the open in negative territory could set a bearish tone ahead of this afternoon’s FOMC policy statement. Whatever its reaction, interim defensive posturing could repeat Monday’s test of 2801.50. And that only serves to chip away at support at this stage. Defensive posturing ahead of FOMC could be accomplished by a shallower dip, but there’s a lot of time before then, and still a lot of news. Extending higher through Wednesday’s open would all but confirm one more upleg is underway, targeting 2873.00.
First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 under 2811.00 would be likely to trigger the 2813.00 bias-down signal at 10:15. Exiting the open above 2817.00 would be unlikely to trigger bias-down. Exiting the open under 2820.00 would be unlikely to trigger the 2823.25 bias-up signal at 10:15.
Morning Bias
| WED morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2823.00 | 2823.25 |
| …would target | 2830.75 | 2831.00 |
| Bias-down: under | 2812.75 | 2813.00 |
| …would target | 2807.25 | 2807.50 |
| Signal status: NO-BIAS | FAQ | |
| Flowcharts: Bias-UP // Bias-DN INTRO VIDEOS #1 and #2 |
||
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.