Posts by Rod David
Morning Bias
| MON morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2735.75 | 2735.50 |
| …would target | 2741.25 | 2741.00 |
| Bias-down: under | 2725.25 | 2725.25 |
| …would target | 2718.75 | 2718.75 |
| Signal status: BIAS-UP, BIAS-UP TARGET EXCEEDED | FAQ | |
| Flowcharts: Bias-UP // Bias-DN INTRO VIDEOS #1 and #2 |
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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)
Friday’s gap-and-run extended substantially, fulfilling all upside objectives. That included probing above 2733.00, which was the next higher objective above 2725.25-2727.25. Friday morning’s bias signal also persisted through the noon hour. And although the afternoon’s 2735.00 bias-up signal triggered, its 2-tick margin was suspicious enough before also being retraced entirely within a couple of minutes.
So, there is no “unfinished business above.” No new unfinished business below was created, but Thursday’s oversold RSIs at 2699.75 remains outstanding.
Departing from the common Friday afternoon template, the trending session ended in retracement. Not extending earlier trending would be more typical, as typical as extending higher, in either case being unlikely to attract counter-trend sponsorship. But sellers made an effort by exiting the bias environment under the noon hour highs despite an interim probe of fresh highs.
Sellers gained traction by probing fresh afternoon lows through the 3:10-3:20 proxy window. But that was where the reaction down ended. The close bounced back up to 2733.00. The break had potential for extending to 2723.50-2724.25, which isn’t required, but now represents the range for noise below.
Details and other markets coverage are discussed in the post-market Wrap recording here.
SATURDAY REVIEW STARTS AT 9:30 ET, ITS LINK WILL BE EMAILED IN THE MORNING.
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 Jun Contract (EC, ETF: (FXE, UUP))
Overnight strength ahead of Friday’s Employment Situation report only attacked Thursday’s pre-open highs before greeting the news back at unchanged around 1.1700. Probing Thursday’s lows down to 1.1630 was recovered back to almost unchanged. Not already reversing down into the weekend suggests the corrective bounce can still test 1.1745-1.1755.
Gold Aug Contract (GC, ETF: (GLD))
Overnight weakness spiked down in reaction to Friday’s Employment Situation report, and gapped down to Tuesday’s 1297.00 low. Probing it momentarily down to 1293.00 was recovered to attack Thursday’s 1305.00 close. Closing under the Tuesday-Friday lows would resume the decline.
Silver Jul Contract (SI, ETF: (SLV))
Greeting Friday’s Employment Situation report in decline blipped-down in reaction but stopped optimistically short of touching Tuesday’s 16.31 low. Bouncing back into positive territory tested 16.45-16.55 as resistance.
30-year Treasury Jun Contract (US, ETF: (TLT))
Growing potential for a retest of Tuesday’s 146-23 high was avoided by the reaction down to Friday’s Employment Situation report testing the 144-20 sell signal. Fluctuating around the signal through the morning .
Crude Oil Jul Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Returning intraday to the 66.63 low of Thursday’s gap down prevented sellers from gaining traction. But it didn’t prevent probing lower overnight, and Friday back down to Tuesday’s 65.75 low. Another close above 67.90 is needed to resume the recovery.
Natural Gas Jul Contract (NG, ETF: (UNG, UNL))
Thursday’s break above the multi-session range was a breakout, but it wasn’t confirmed by a second consecutive higher close Friday. At least an eventual higher close at 3.00 or more remains outstanding from the prior week’s confirmed breakout.
Mid-day Update… More, or less?
Upside influences lapsing.
This afternoon’s 2735.00 bias-up signal just triggered, late with the grace period’s assistance. That was by a narrow margin of 2 ticks, despite having been to 2737.00 just minutes earlier. 
And 2735.00 was touched only a couple of minutes later, which would have triggered noN-bias.
So, take this afternoon’s bias-up signal with a grain of salt, or trade it carefully.
Today’s rally was relying on an afternoon bias-up to help it extend higher. Friday morning’s bias tends to persist through the noon hour, but that window has lapsed. Also, Fridays rarely trend throughout, so even the gap-and-run setup’s influence has lapsed.
And now 2735.00 is being probed as support. It’s also the rally’s current pullback limit, so it’s on the verge of being violated. The sell signal currently at 2731.75 can be threatened under 2733.00. But there’s no requirement otherwise to trend in either direction, as Friday afternoons are difficult to attract sponsorship or reinforcements.
Look ahead: Economic Calendar – for Mon Jun 4, 2018
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: Only one report is scheduled for Monday. It doesn’t have a reliable track record for influencing price action. But being the session’s only report, any surprise from it could have a more substantial effect.
Factory Orders
10:00 AM ET
3-Month Bill Auction
11:30 AM ET
6-Month Bill Auction
11:30 AM ET
TD Ameritrade IMX
12:30 PM ET