Posts by Rod David
Look ahead: Economic Calendar – for Mon May 14, 2018
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: Any reaction to Bullard’s remarks that he made before Friday’s open will have influenced price action ahead of his remarks on Monday, as markets gravitate in the direction of Friday’s reaction. Of course, the reaction is unlikely to be duplicated, because of being discounted. There are no other econ reports for the day.
*James Bullard Speaks
9:40 AM ETD
3-Month Bill Auction
11:30 AM ET
6-Month Bill Auction
11:30 AM ET
Afternoon Bias
| FRI afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 2731.50 | 2730.50 |
| …would target | 2738.00 | 2737.00 |
| Bias-down: under | 2722.50 | 2721.50 |
| …would target | 2713.00 | 2712.00 |
| 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… No rejection yet.
Gap up and new highs are holding up.
The 2726.75 overnight high had pulled back before the open. It was similar to the earlier defensive posturing ahead of Europe’s opens. 
Neither was deep enough to reverse down, so my pre-open comments in the chaRTroom reiterated expectations for opening strength.
The open did gap up, albeit under yesterday’s high. Post-open did surge to probe yesterday’s high. And after consolidating back down to the 2722.75 bias-up signal, higher highs fulfilled the 2730.00 bias-up target up to 2731.25.
Which held, triggering bias-up, bias-up target met. The window’s lower-end should be defined by its 2722.75 bias-up signal if tested. If probed before that window lapses, then it should be retraced. Perhaps for longer, as this is a Friday when the morning bias signal tends to persist through the noon hour, although that’s not required.
Meanwhile, this is still a bias-up environment, regardless of having met its target. But today is unlikely to duplicate the prior two sessions’ strong intraday rallies. That’s also not required, and exiting the bias environment above its 2730.00 bias-up target would suggest. Otherwise, a flat-to-lower afternoon would be likely.
The First Trade & Pre-open Tour Recording… Probing, and possibly gapping.
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 duplicated Wednesday’s strong intraday rally. Both gapped up, extended sharply higher into their afternoon bias environments, and then ranged sideways through the close around their next higher objectives. Thursday’s pre-open dip had touched Wednesday’s 2696.75 objective as support before rallying to its 2721.50 objective, which was tested up to 2725.00. Reacting down to 2713.00 was recovered up to 2721.50 through the cash session close. No “unfinished business above” was left outstanding.
Overnight action’s new info…
Globex was greeted back down at 2716.00 which had been the target of Thursday’s last reaction down. A gradual recovery to 2723.00 was suddenly retraced to 2716.50 before Europe’s opens (defensive posturing?) but the dip was soon recovered. And now the recovery has extended to probe yesterday’s highs attacking 2627.00.
If, then…
The similarities between Wednesday and Thursday’s consecutive rallies don’t dictate Friday’s pattern, but they do narrow down its possibilities. Thursday afternoon’s pattern does have a likely resolution, which is to gap up (i.e. to already extend the rally overnight) or at least to trend up into the open. Yesterday’s highs are finally being probed, or initially being probed — it’s still early. Another gap up? The Wednesday-Thursday similarities suggest this setup won’t extend higher, so we would expect it to reverse down. Opening flat or backing-and-filling could still resolve up, but would at least be vulnerable to reversing down.
First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 above 2725.00 would be likely to trigger the 2722.75 bias-up signal at 10:15. Exiting the open under 2718.00 would be unlikely to trigger bias-up. Friday morning bias signals tend to persist through the noon hour.
Morning Bias
| FRI morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2724.25 | 2722.75 |
| …would target | 2731.50 | 2730.00 |
| Bias-down: under | 2717.50 | 2716.00 |
| …would target | 2710.50 | 2709.00 |
| Signal status: BIAS-UP, BIAS-UP TARGET MET | 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.