Posts by Rod David
Look ahead: Economic Calendar – for Thu Apr 5, 2018
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: None of Thursday’s econ reports has a reliable track record for influencing price action, although at least Claims is high-profile. The afternoon is greeted by a Fed speaker, which might help to keep alive some volatility when the afternoon before Friday’s payrolls often become subdued.
Challenger Job-Cut Report
7:30 AM ET
International Trade
8:30 AM ET
Jobless Claims
8:30 AM ET
Bloomberg Consumer Comfort Index
9:45 AM ET
EIA Natural Gas Report
10:30 AM ET
*Raphael Bostic Speaks
1:00 PM ET
Treasury STRIPS
3:00 PM 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 | 2606.25 | 2607.50 |
| …would target | 2619.75 | 2620.00 |
| Bias-down: under | 2593.25 | 2594.50 |
| …would target | 2583.75 | 2585.00 |
| Signal status: LATE NO-BIAS, TESTED BIAS-UP 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… One false break deserves another.
Rallying into and out of the open.
The last overnight downleg was a plunge to 2559.50, which had originated from a Symmetrical Triangle. The pattern tends often to break falsely in one direction before reversing more substantially in the opposite direction. Being an overnight pattern, its influence had to be obvious through the opening 15 minutes of volatility to be influential intraday.
In fact, the triangle’s upper-end was retraced entirely up to 2581.50 before the open. But it was fresh post-open highs that confirmed a bigger reversal underway. And by any measure, the triangle’s false break was exceeded by rallying to 2595.00.
Meanwhile, 2595.00 is this morning’s bias-up signal. And it triggered (late after invoking the grace period). Its 2585.75 bias-down target is already met, so it won’t become “unfinished business below.” But 2595.00 should still define the window’s upper-end, or else require being retraced.
In fact, 2595.00 is being probed right now up to 2601.00. It requires being retraced. Actually reversing back under 2593.00 would start to signal this morning’s bounce had ended and is reversing back down. Otherwise, extending the rally this afternoon would target a retest of yesterday afternoon’s overbought RSIs at 2618.75.
BONUS: Here’s a video description of the Symmetrical Triangle’s setup, and the overnight influence’s setup:
https://ilos.video/gIYi77
The First Trade & Pre-open Tour Recording… 1987-style.
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…
Tuesday’s gap up extended to 2597.50 before reacting down almost 25 points to 2573.25, and filling the gap back to Monday’s close. The 2687.75 bias-up signal had already failed to trigger, putting into play an offsetting test of its 2566.50 bias-down signal. That didn’t prevent the balance of the morning from rallying to fresh session highs. Its no-bias trending could have been invalidated by exiting the bias environment above its 2601.50 bias-up target. The target held as resistance despite being probed up to 2605.50, so it wasn’t for lack of trying that 2566.50 became “unfinished business below.” That still didn’t prevent extending higher, albeit after another 25-point dip to 2580.00. Late highs attacked 2619.00 and took RSIs simultaneously overbought before reacting down to 2603.25.
Overnight action’s new info…
Another trade war attack by China has retraced yesterday’s rally. Swallowed it whole. Bouncing out of Tuesday’s late pullback had never recovered to retest intraday highs. Price soon began drifting back down and retested the pullback’s 2603.25 low by 3 ticks. Flat-to-lower ranging accelerated its pace into and out of Europe’s opens. Headlines soon triggered a plunge through yesterday’s low to 2569.25. A 2-hour consolidation back up to 2580.00 broke lower to 2559.50. That break has been retraced back up to the consolidation’s “lower prior highs” at 2574.00.
If, then…
Avoiding a repeat of Monday’s plunge on Tuesday probably wasn’t bullish. But it left only a very narrow window for tracking the 1987-style crash template — by trending down sharply Wednesday either without delay or by the morning bias environment exit. Having trended down sharply already overnight, a flat or flat-to-higher morning is possible. But the crash template is fueled by intraday selling, and would require resuming the decline aggressively this afternoon. Regardless of the character or path there, 2509.00-2511.00 remains the next lower objective.
First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 under 2580.50 would be likely also to exceed the 2585.75 bias-down target through 10:15 to renew the bias-down signal.
Morning Bias
| WED morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2619.00 | 2620.00 |
| …would target | 2627.00 | 2628.00 |
| Bias-down: under | 2594.00 | 2595.00 |
| …would target | 2584.75 | 2585.75 |
| Signal status: LATE BIAS-DOWN, BIAS-DOWN TARGET MET | 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.