Posts by Rod David
Look ahead: Economic Calendar – for Tue Jul 31, 2018
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: The 2-day FOMC meeting starts, which might get attention Tuesday. But the two post-open econ reports are reliably influential to price action. Note that the PMI is released several minutes earlier to institutional subscribers, and their reaction in the market is usually duplicated when released to the rest of us. Also, any noticeable reaction to a pre-open report is likely to be duplicated by a post-open report.
Personal Income and Outlays
8:30 AM ET
Employment Cost Index
8:30 AM ET
Redbook
8:55 AM ET
S&P Corelogic Case-Shiller HPI
9:00 AM ET
*Chicago PMI
9:45 AM ET
*Consumer Confidence
10:00 AM ET
State Street Investor Confidence Index
10:00 AM ET
Afternoon Bias
| MON afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 2815.50 | 2816.00 |
| …would target | 2822.00 | 2822.50 |
| Bias-down: under | 2806.50 | 2807.00 |
| …would target | 2801.00 | 2801.50 |
| Signal status: BIAS-DOWN, BIAS-DOWN TARGET MET | FAQ | |
| Flowcharts: Bias-UP // Bias-DN INTRO VIDEOS #1 and #2 |
||
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… Eventually, down.
Very late surge proves too late to maintain.
In the Market Tour I described the potential paths higher for having recovered tests of both bias parameters overnight. The paths higher differed in whether the open would be greeted in positive territory.
Which it was not. It was already too late to expect the 2824.25 bias-up signal to trigger, if tested. Which it was not.
Recovering only to Friday’s 2817.50 cash session close, and then surging just several minutes before the open, only attacked 2822.00. That stretched the rubber band enough to probe the 2815.00 bias-down signal to 2810.50. But 2815.00 was touched in time to invoke the grace period.
2815.00 was recovered by a single tick at 10:30 to trigger late no-bias. Another tick lower would have triggered noN-bias, not bias-down. Nevertheless, being on the borderline, dipping back under 2813.00 is getting a benefit of the doubt. In fact, its 2809.00 bias-down target was just touched.
Extending lower would next target 2801.50. Having touched the bias-down target after a very choppy open, back above 2815.75 would start to signal momentum reversing up.
The First Trade & Pre-open Tour Recording… Flat choppiness.
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 night’s shallow rally was nevertheless relentless, and also productive for having probed Thursday’s 2846.50 high. The proximity to “unfinished business above” at 2848.75 proved irrelevant when the 2842.00 open slid to 2830.00 through the morning. More so as the slide accelerated to test 2809.00 through the noon hour. The balance of the afternoon ranged choppily flat-to-higher up to 2821.00, forming an Ascending Triangle. Testing the 2818.00 “lower prior high” held through the close, while neutralizing unfinished business below at 2813.75.
Overnight action’s new info…
Sunday night’s open bobbled momentarily, then soon spiked down and eventually extended to 2806.50 before midnight. Firming into and out of Europe’s opens has only continued firming, now attacking Friday’s 2817.50 futures close to within 3 ticks. Friday’s cash session close equated to 2820.00.
If, then…
Both bias-down parameters have been probed overnight. Often, the bias-up signal is also tested. Whether or not bias-up then triggers is determined from post-open price action. That’s if bias-up is also tested, which it often is — but not always. Greeting the open in negative territory under 2817.50-2820.00 would more likely retest overnight lows. And extending Friday morning’s decline would next target 2801.50.
First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 under 2813.00 would be likely to trigger the 2815.00 bias-down signal at 10:15. Exiting the open above 2821.50 would be unlikely to trigger bias-down.
Globex chaRTroom Link
All systems appear to be on “go” for the Globex open several minutes away. Charts are operational, and there’s an Ascending Triangle left over from Friday afternoon that’s just waiting to resolve. I’ll check-in this evening to update levels… See you there!