Posts by Rod David
Market Wrap (recording & summary)
Tuesday afternoon’s rally had gained traction for its effort. Reversing down Wednesday morning required gapping under a relevant support. 
Wednesday’s open did gap down — after testing fresh highs up to 2658.50 several times overnight.
But the 2648.00 open was too shallow to reflect strong-handed sponsorship. And the morning’s 2642.00 bias-down signal didn’t trigger. So, no reversal down.
Also, no intraday probe above Tuesday’s 2654.00 intraday high, not until the afternoon’s FOMC policy statement reaction. Surging to 2658.50 took RSIs overbought, which requires an eventual retest.
Oversold RSIs at the morning’s 2640.25 low were more attractive. Its retest targeted at least 2635.00, but that extended to 2629.00. Retracing to between 2630.50-2633.00 within 3 minutes of the cash session close avoided triggering both a hold-short and hold-long setup. Actually, 2633.00 was being overlapped, which is not a decisive break.
Despite not triggering hold-short, post-close action is extending down so far to 2627.00. Isolating it to open Thursday back above 2635.00-2638.00 could target a retest of Wednesday’s 2658.50 high, which would all but ensure retesting Monday’s 2783.25 high. Extending down anyway could resume the bigger picture’s decline.
Details and other markets coverage are discussed in the post-market Wrap recording here.
Monitor overnight Globex trading in the chaRTroom here.
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))
Fresh lows under 1.2000 almost prevented another opportunity to start forming a bottom. But the afternoon’s recovery back into Tuesday’s range makes immediately upside follow-through credible for extending initially to 1.2120-1.2160.
Gold Jun Contract (GC, ETF: (GLD))
Wednesday’s gap up held under its 1316.00 bounce limit to maintain the downside momentum of Tuesday’s confirmed breakout still requiring an eventual third lower close, and probably to extend down to 1294.00.
Silver Jul Contract (SI, ETF: (SLV))
Gapping up Wednesday filled the gap back to Monday’s 16.40 highs, but didn’t threaten to recover the 16.45 sell signal. An eventual third lower close is required to fulfill the confirmed breakout.
30-year Treasury Jun Contract (US, ETF: (TLT))
Probing lower overnight was recovered to continue fluctuating intraday Wednesday around the 143-07 sell signal, whose break Thursday would greet Friday’s Employment Situation report from a position of weakness.
Crude Oil Jun Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Wednesday morning’s weakness didn’t repeat Tuesday’s attack on the 66.80 pullback limit where a snap back up could launch a rally to fresh highs. A bounce back into positive territory must extend higher without delay to avoid making fresh lows down to 66.35 likely.
Natural Gas Jun Contract (NG, ETF: (UNG, UNL))
Tuesday’s rally had to contain the corrective bounce’s peak to maintain the confirmed breakout pattern which is still awaiting at least a third lower close under 2.72 Wednesday’s gap down did weaken intraday, greeting Thursday’s EIA report from a mixed position..
Mid-day Update… Defensive posturing.
No morning rally, or downtrend.
This morning’s opening dip only came to within 1 tick of its 2642.00 bias-down signal. That didn’t stretched the rubber band tightly enough for a snap back up to its bias-up signal. But the gap back to yesterday’s 2652.00 cash session close was attacked to within 1 point.
Then another dip tested 2642.00, by almost 2 points as the bias environment lapsed. But it was too late to trigger bias-down. It was, however, late enough to extend down, but sellers lacked sponsorship. So another bounce is attacking 2652.00 to within 1 tick.
Anxiousness ahead of the 2:00 FOMC Policy Statement likely bears some responsibility for inhibiting trending in either direction. It may also be responsible for preventing a morning probe above yesterday’s highs. That inhibitor will soon resolve, and the door remains open to fresh highs.
Fresh highs aren’t required, and they’re not required to extend or even to be maintained. Regardless of fresh highs, back under 2645.00 would more likely launch a retracement of yesterday afternoon’s rally, at least to 2635.00.
Look ahead: Economic Calendar – for Thu May 3, 2018
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: Thursday is this week’s busiest econ calendar. Amazingly, none of its items has a reliable track record for influencing price action. Nevertheless, several are high-profile, and each can have more impact than usual because of the vacuum. Meanwhile, a reaction to any pre-open report is likely to be duplicated in reaction to post-open reports.
Challenger Job-Cut Report
7:30 AM ET
International Trade
8:30 AM ET
Jobless Claims
8:30 AM ET
Productivity and Costs
8:30 AM ET
Bloomberg Consumer Comfort Index
9:45 AM ET
PMI Services Index
9:45 AM ET
Factory Orders
10:00 AM ET
ISM Non-Mfg Index
10:00 AM ET
EIA Natural Gas Report
10:30 AM ET
Fed Balance Sheet
4:30 PM ET
Money Supply
4:30 PM ET
Afternoon Bias
| WED afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 2655.75 | 2653.25 |
| …would target | 2663.50 | 2661.00 |
| Bias-down: under | 2641.25 | 2639.00 |
| …would target | 2635.75 | 2633.50 |
| Signal status: NO-BIAS | 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.