Posts by Rod David
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))
Tuesday’s shallow dip had nevertheless held a relevant support at 1.1740 before recovering to attack the morning’s high. But it still needed a second consecutive higher confirming close. Which didn’t come, as Tuesday morning trended back down to and through Friday’s close to attack 1.1700.
Gold Aug Contract (GC, ETF: (GLD))
An overnight rally held the 1245.50 bounce limit but still gapped up slightly above Monday’s 1240.00 close. Then price plunged back through the decline’s 1237.50 target to fresh lows testing 1226.00. After Monday’s low had neutralized the “unfinished business below” at Friday’s opening gap down, there was no bullish reason for any further weakness, enabling Tuesday’s sizeable reaction.
Silver Sep Contract (SI, ETF: (SLV))
Tuesday’s gap down back to Friday’s shallow low proved that previous bottoming attempts were ‘ineffectually optimistic” as the morning slid sharply to attack 15.55.
30-year Treasury Sep Contract (US, ETF: (TLT))
If Monday’s probe under the channel’s 145-02 lower-end were a false break, then Tuesday should have rejected the probe by rallying sharply. But price only hovered, suggesting that Monday’s probe was a warning shot across the bow. Breaking above Monday’s high through Wednesday’s open would be credible for launching another bounce, but at least another downleg has become more likely.
Crude Oil Aug Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Regardless of having fulfilled the confirmed breakout’s minimum objective with Monday’s fresh low close, no buy signal had formed, and Tuesday probed slightly lower lows intraday.. Then it recovered positive territory, albeit only slightly positive, but not confirming the decline’s momentum.
Natural Gas Aug Contract (NG, ETF: (UNG, UNL))
Monday’s choppy bounce had tried extending slightly higher overnight to 2.79, but Monday morning drop to fresh lows at 2.73 essentially proved the decline remains intact. That’s probably not enough consequence for the failed choppy bounce, suggesting that lower lows remain in-play.
Mid-day Update… More targets met.
Still on the open’s buy signal.
Opening at 2791.00 ultimately held a test of this morning’s 2894.75 buy signal through 10:15. That put into play an offsetting test of
this morning’s 2803.50 bias-up signal. The objective was probed up to 2806.75.
A dip touched 2803.50 and resumed the rally into the noon hour. And out of it. This afternoon’s 2809.00 bias-up signal has triggered, putting into play its 2816.75 bias-up target. Already, 2814.00 has been touched.
A lot of calculable buying pressure is being satisfied by fulfilling objectives and targets. Bigger picture structural objectives are being neutralized at 2809.00 and 2813.00 prior highs. No sell signal has triggered, but direction can reverse quickly when sponsorship starts waning.
Back under 2809.00-2810.00 would start to warn of a different sentiment forming. But the trend otherwise remains intact and up.
Look ahead: Economic Calendar – for Wed Jul 18, 2018
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: Day-two of Fed Chair Powell’s congressional testimony follows Tuesday’s very bullish reaction to day-one. So, another very bullish reaction? Somewhat bullish reaction? Actually, day-two’s reaction is often discounted somewhat Tuesday. Any legitimately surprised reaction will more likely come from Powell walking-back anything that he might be concerned had a greater impact than desired.
MBA Mortgage Applications
7:00 AM ET
Housing Starts
8:30 AM ET
*Jerome Powell Speaks
10:00 AM ET
EIA Petroleum Status Report
10:30 AM ET
*Beige Book
2:00 PM ET
Afternoon Bias
| TUE afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 2807.50 | 2809.00 |
| …would target | 2815.25 | 2816.75 |
| Bias-down: under | 2799.75 | 2801.50 |
| …would target | 2793.75 | 2795.50 |
| Signal status: BIAS-UP | 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… Getting worked up.
Post-open rally returns to positive territory.
A fresh low before the open came within 2 ticks of this morning’s 2789.25 bias-down target. Rallying into the open and through the opening 15 minutes of volatility was testing the 2794.75 bias-down signal. That had extended to 2798.00 when “no-bias” triggered.
Having held a test of the bias-down signal, an offsetting test of the 2803.50 bias-up signal is in-play. Already probing higher since 10:15 makes the upside objective highly likely to be met sooner rather than later.
Nevertheless, back under the 2795.00 aera would start to signal the bounce had failed. Natural resistance at yesterday’s 2800.50 cash session close is now being touched, after trending up relentlessly for an hour. Any relief rally from Fed Chair Powell’s opening remarks is probably waning.