Posts by Rod David
Morning Bias
| TUE morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2626.00 | 2625.75 |
| …would target | 2635.50 | 2635.25 |
| Bias-down: under | 2605.25 | 2605.00 |
| …would target | 2595.25 | 2595.00 |
| 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)
Monday’s 83-point round-trip rallied 40 points off of the open’s 2614.00 low up to 2654.00, then back down to 2610.00 at the close. As usual, they fell faster than they rose: the afternoon retracement lasted only two hours. The last-minute low overlapped Friday’s last-minute high be almost 2 points — hardly what the market seemed to be considering at its session high.
All of which developed in positive territory. That’s a lot of selling pressure to expend without gaining traction for the effort.
However, the gap back down to Friday’s 2603.00-2606.00 close wasn’t even attacked, let alone filled. So much of the afternoon drop developed so late, that I don’t view the close as “stopping optimistically short” of its potential. Regardless of the complete post-open retracement, the burden of proof is on sellers.
Already extending down at Tuesday’s open would be likely to persist through the morning. Friday’s decline could even resume. Otherwise, China and Facebook may keep price action constricted and inhibited.
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 Mar Contract (EC, ETF: (FXE, UUP))
Gapping up Monday extended to test the 1.2390 buy signal. Closing back under 1.2340 would reject the recovery attempt. It would become a pullback limit if the buy signal triggers first, which would target 1.2480-1.2510.
Gold Jun Contract (GC, ETF: (GLD))
Slightly weaker action Sunday night was recovered into the open to range narrowly unchanged Monday. Resistance at 1339.00 was probed late in the day, which must be rejected with little if any delay Tuesday to maintain the pattern’s downside potential.
Silver May Contract (SI, ETF: (SLV))
Monday initially ranged flat-to-higher around 16.40 resistance before extending to attack 16.55 into the afternoon. Just closing above 16.40 invalidates the close under it that was awaiting a second consecutive lower close to confirm. Closing above 16.55 would essentially signal the trend reversing up again.
30-year Treasury Jun Contract (US, ETF: (TLT))
Friday’s unimpressive reaction to the Employment Situation report didn’t look any better Sunday night, or Monday which ranged narrowly flat-to-lower. None of which yet invalidates the attraction to fill the gap back up to last Monday’s 146-26 close.
Crude Oil Apr Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Gapping back up above the 62.62 pullback limit Monday extended only slightly higher intraday, but keeps alive potential for closing even higher Tuesday to signal the pullback has ended and that 66.88 is back in-play.
Natural Gas May Contract (NG, ETF: (UNG, UNL))
Collapsing at Monday’s open from 2.70 fell to within 2 cents of retesting the 2.62 prior low. Consolidating there resolved back up to test 2.70. Closing higher Tuesday would have to get a benefit of the doubt for being able to avoid fresh lows before rallying to fresh highs.
Mid-day Update… Getting one-sided.
Duplicate setup suggests bigger move forming.
This morning’s post-open rally extended to test Friday afternoon’s 2634.25 bias-environment high. RSIs diverged negatively on a retest of 2634.25. 
The tests’ 2630.50 interim low was never pierced before the rally resumed.
That’s one.
The noon hour extended the rally to attack 2646.00. RSIs diverged negatively again on its retest. The tests’ 2641.00 interim low was never pierced before the rally resumed.
That’s two.
And that’s borderline overkill. Negative divergence is not an actionable sell signal. It can inform a sell signal, suggesting it is more reliable if triggered. Two negative divergences can be that much more bearish, making a sell signal that much likelier to produce a substantial reversal. If triggered.
Meanwhile, maybe a much stronger uptrending undercurrent is causing the negative divergences to be ignored. It’s rare, but a third negative divergence would likely extend the rally sharply. This afternoon’s bias-up signal triggered, putting into play 2653.50. It’s likely to be tested, and possibly exceeded, so long as 2644.00 isn’t broken as support.
Look ahead: Economic Calendar – for Tue Apr 10, 2018
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: Traders love a spectacle, including high-profile congressional hearings. Zuckerberg testifying on Tuesday could distract their attention, and calm the market’s recent volatility.
Robert Kaplan Speaks
4:30 AM ET
NFIB Small Business Optimism Index
6:00 AM ET
*PPI-FD
8:30 AM ET
Redbook
8:55 AM ET
Wholesale Trade
10:00 AM ET
4-Week Bill Auction
11:30 AM ET
3-Yr Note Auction
1:00 PM ET