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 Mar Contract (EC, ETF: (FXE, UUP))
Friday was still overlapping 1.2390 like Thursday, and also ranging narrowly around it, ultimately flat-to-higher, keeping alive the likelihood that Thursday’s gap down was only a temporary pullback.
Gold Jun Contract (GC, ETF: (GLD))
The 1339.00 test had tried extending down after Thursday’s close and before Friday’s open but still reacted back up above 1344.00 Friday morning, also testing the 1347.25 buy signal. Extending higher would target 1361.00-1364.00.
Silver May Contract (SI, ETF: (SLV))
Repeated efforts after Thursday’s close to extend down under 16.50 failed, allowing Friday morning to bounce back up above 16.60. Extending higher would target a retest of 16.80.
30-year Treasury Jun Contract (US, ETF: (TLT))
The corrective bounce potential from Thursday’s test of 145-02 was not very pronounced Friday, but at least the pullback has paused if not ended. Extending higher would target 146-10 before a bigger downleg becomes likely.
Crude Oil Apr Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Multiple days of hovering narrowly around the 66.88 had already indicated the intent to probe higher, next targeting 69.50. Firming into the weekend may be the breakout that starts the next upleg.
Natural Gas May Contract (NG, ETF: (UNG, UNL))
Ongoing ranging between 2.65-2.70 finally resolved Friday, but it wasn’t down to retest the decline’s 2.62 target or lower. Friday gapped up and extended to test 2.75, whose recovery could marginalize sellers. I’m suspicious of that, since the gap back to Thursday’s close would want to be filled. Also, the first breakout attempt from an extended narrow range tends to be false.
Mid-day Update… Done with down?
Post-open collapse holds support.
The minimum likelihood for a session-long rally was fulfilled by at least probing a fresh high the following morning. Vulnerability to collapsing is usually delayed until that afternoon, but this morning couldn’t be bothered to wait. And, why not. Yesterday’s action barely qualified as a rally, overnight action initially dipped, and Friday Factors can exercise unusual influence.
Also, the fresh high touched the 2680.75 bias-up target to within 1 tick. Actually touching it was necessary to actually reject it. So, having failed to trigger its 2672.00 bias-up signal, an offsetting test of its 2648.25 bias-down target isn’t actually required. But it’s likely if the 2654.00 bias-down signal fails to hold.
About that. This morning’s 2654.00 bias-down signal held. it was probed down to 2651.00 after triggering no-bias, and it was recovered before the bias environment began lapsing. Breaking it is now difficult. That doesn’t necessarily default to a rally, although that’s now easier.
About that. This afternoon’s 2667.25 bias-up signal held. It wasn’t touched in time to trigger, not until 1:30 when it could still be recovered to invalidate this afternoon’s no-bias environment. It didn’t. It should define the window’s upper-end.
Back under 2662.50 would start to signal another test of 2654.00 likely. Otherwise, exiting the bias environment at or near 2667.25 would be more vulnerable to drifting higher into the close.
Look ahead: Economic Calendar – for Mon Apr 16, 2018
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: The econ calendar is busy for a Monday. The pre-open Retail data will is both high-profile, and influential to price action. Any noticeable reaction to its report is likely to be duplicated by post-open reports.
*Retail Sales
8:30 AM ET
Empire State Mfg Survey
8:30 AM ET
Business Inventories
10:00 AM ET
Housing Market Index
10:00 AM ET
3-Month Bill Auction
11:30 AM ET
6-Month Bill Auction
11:30 AM ET
*Raphael Bostic Speaks
1:15 PM ET
Afternoon Bias
| FRI afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 2667.50 | 2667.25 |
| …would target | 2675.00 | 2675.00 |
| Bias-down: under | 2655.00 | 2655.00 |
| …would target | 2649.25 | 2649.00 |
| Signal status: NO-BIAS | FAQ | |
| Flowcharts: Bias-UP // Bias-DN INTRO VIDEOS #1 and #2 |
||
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… Minimum strength, maximum rejection.
Overnight recovery and post-open high reverse down sharply.
We’ve come a long way from being willing to consider sell signals this morning. Sell signals have triggered, and price has reversed down, a lot.
A property of the “session-long rally” setup is that fresh highs should be probed the following morning. 
That may have seemed unlikely when the close collapsed 12 points to 2662.00, and when overnight action extended down another 10 points to 2652.00. But rallying from midnight through the open got to 2680.50.
Follow-through fulfilled.
That high is within 1 tick of this morning’s 2680.75 bias-up target. Its reaction down to 2661.00 through the bias timing window avoided triggering the 2672.00 bias-up signal. Rejecting the bias-up signal puts into play an offsetting test of the 2654.00 bias-down signal. Rejecting the bias-up target, too, puts into play an offsetting test of the 2648.25 bias-down target.
Already, the 2654.00 bias-down signal is being attacked to within 1 point. Oversold RSIs at the low require its reaction to fail. And it is reacting, back up to 2661.00. Almost any lower could find an air pocket or two that are unable to offer support for awhile.