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))
Thursday’s overnight test of the 1.1625 target was tested intraday for the first time at Tuesady’s open. The gap back up to Monday’s 1.1700 close requires eventually being filled. The balance of the morning bounced to 1.1665, maintaining what is now the bounce limit at 1.1675.
Gold Aug Contract (GC, ETF: (GLD))
Having held a test of the 1284.00 bounce limit Monday, the decline was free to resume, which it did overnight down to 1272.50. Its reaction up held Friday’s “higher prior lows” at 1278.50.
Silver Jul Contract (SI, ETF: (SLV))
Monday’s bounce attempt was shallow and brief and settled under uptrending support at 16.45. Trending down overnight to 16.25 was recovered through the morning up to 16.37, maintaining the decline’s momentum.
30-year Treasury Sep Contract (US, ETF: (TLT))
Monday’s shallow gap up was retraced to the 143-16 buy signal, which launched an overnight rally to fresh recovery highs at 144-25. Its reaction down tested Friday’s 144-10 high as support.
Crude Oil Aug Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Extending down overnight, after Monday had held the 65.65 buy signal, probed Friday’s low for a 61.8% retracement of the bounce from Sunday night’s 63.40 low. Just closing under 64.10 would signal that Friday’s break under 66.10-66.30 is extending into a new downleg. Meanwhile, Wednesday’s EIA report is being greeted from a position of weakness.
Natural Gas Jul Contract (NG, ETF: (UNG, UNL))
Friday’s breakout had satisfied the outstanding requirement for at least one more new high close. Reacting down Monday avoided confirming the new breakout. But holding 2.95 had prevented signaling that momentum is reversing down. Extending down overnight now triggers that signal, but requires its own second consecutive lower close Wednesday to confirm — or else Thursday’s EIA report won’t be greeted from a position of weakness.
Mid-day Update… Hope springs, again.
Choppy morning struggles to hold above critical support.
The open’s gap down surged back up. Its reaction probed fresh post-open lows down to 2735.75, and that was recovered to test yesterday’s pre-open “higher prior lows” at 2764.00. That’s just short of 2767.00 whose recovery through the close could reverse the trend up. That was also by noon, leaving plenty of time for another downdraft.
In fact, another downdraft has attacked 2754.00 while triggering a late bias-down. That has become suspicious, itself, now that its reaction up is testing 2762.00. The bias-down environment’s upper-end should be defined by its 2758.50 bias-down signal if tested, and it’s being tested. Being a late bias signal helps price action to ignore it.
Exiting the bias environment above its 2767.00 bias-down signal would invalidate the late bias-down. And it would likely squeeze higher through tomorrow’s open. Otherwise, back under 2757.50 would resume the decline.
Look ahead: Economic Calendar – for Wed Jun 20, 2018
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: Powell and Draghi speak at a conference in Portugal, which is easily the most influential item for Wednesday. It may also be the only influential item, since the others have no reliable track record for influencing price action. Still , any reaction to a pre-open report would likely be duplicated in reaction the post-open report — especially since the post-open report is the second Housing sector report this week.
MBA Mortgage Applications
7:00 AM ET
Current Account
8:30 AM ET
Existing Home Sales
10:00 AM ET
EIA Petroleum Status Report
10:30 AM ET
Afternoon Bias
| TUE afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 2763.50 | 2767.00 |
| …would target | 2770.00 | 2773.50 |
| Bias-down: under | 2755.00 | 2758.50 |
| …would target | 2747.00 | 2750.50 |
| Signal status: LATE BIAS-DOWN | 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… In too deep?
Post-open volatility still includes bounces.
Dipping overnight to test 2736.00 was recovered pre-open to test 2754.00. The 2750.50 open surged to 2756.00, which had been put into play by revisiting 2767.00 yesterday. 
Now it had been tested intraday, so closing back above it would signal that sellers were likely done. Its test extended up to 2758.75, but 2756.00 held as resistance through the open.
And now, after an interim dip attacked 2746.00, its reaction up is retesting the 2758.75 post-open high. This sudden optimism seems premature, since the overnight low’s retest has a minimum likely objective of 2738.50. Fresh lows would target 2732.00.
Closing today above 2756.00 is possible without yet fulfilling likely downside objectives. That would create a position of strength to better enable a recovery if another sell-off were attempted tomorrow morning. Or, 2756.00 could be both recovered and already exploited today.
So, until today’s close is above 2756.00, or until recovering 2767.00, bounces are possible, but not likely to be durable.