Posts by Rod David
Market Wrap (recording & summary)
Tuesday avoided a repeat of Monday’s plunge. That’s not necessarily bullish, and probably isn’t. But it leaves 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. Regardless, Tuesday’s bounce is still likely only a temporary correction, likely to resolve down anyway.
Overbought RSIs at Tuesday’s 2618.75 high require a retest. That should include 2620.00 and potentially 2628.00 or 2631.00, while still being only a temporary correction of Monday’s plunge. Meanwhile, “unfinished business below” was left outstanding at 2566.50, which should be tested on the way to resuming Monday’s plunge.
- 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))
Monday’s failed bounce extended down deeper Tuesday morning to probe fresh lows. Meanwhile, the required eventual third lower close was fulfilled. But the trend remains down so long as bounces now hold 1.2365.
Gold Jun Contract (GC, ETF: (GLD))
Gapping up and surging Monday was somewhat retraced overnight, but the 1339.00 reversal signal wasn’t probed until mid-morning, and then resisted a bounce into the afternoon. A second consecutive lower close on Wednesday would be optimal confirmation that the decline has resumed.
Silver May Contract (SI, ETF: (SLV))
Pulling back overnight held 16.50 but extended down Tuesday to test the 16.40 sell signal. It was still being overlapped into the afternoon, requiring another decisive close under it Wednesday to trigger.
30-year Treasury Jun Contract (US, ETF: (TLT))
Two eventual higher closes had more than fulfilled the recent confirmed breakout’s minimum requirement, but Tuesday’s open created a gap back up to Monday’s close that will want to be filled eventually, and would meanwhile inhibit a reversal down.
Crude Oil Apr Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Monday’s deeper dip wasn’t immediately recovered Tuesday, but neither did it extend down. The pullback still has room down to 62.62 while awaiting a recovery back above 64.25 that would target 66.88.
Natural Gas May Contract (NG, ETF: (UNG, UNL))
Tuesday did not immediately resume Monday morning’s dive and instead bounced to test 2.70 resistance. The downtrending support that was still being tested at Monday’s close wasn’t decisively recovered, but neither did it hold as resistance.
Mid-day Update… What’s the hold-up?
Holding above yesterday’s late high hasn’t extended higher.
The open’s 2588.00-2597.00 range had resolved down to avoid triggering bias-up. Despite putting into play an offsetting test of the 2566.50 bias-down signal, despite probing the pre-10:15 lows, and despite extending down to 2573.50… the balance of the bias environment rallied to fresh highs at 2606.00.
Exiting the bias environment above its 2601.50 bias-up target would have invalidated the no-bias signal and its lower objective. Despite rallying 33 points from low to high, and despite probing fresh highs up to 2606.00, the bias environment lapsed back under 2601.50.
So, 2566.50 is “unfinished business below.” Overbought RSIs at the 2606.00 high require an eventual retest. Perhaps that attraction above is what’s responsible for limiting the noon hour’s pullback to 2584.00. Back under 2590.00 and 2585.00 would start to overwhelm that higher attraction in favor of trending back down.
Look ahead: Economic Calendar – for Wed Apr 4, 2018
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: Here comes monthly payrolls. Indications of the market’s reaction can be gleaned from Wednesday’s ADP report, which is both high-profile and reliable for influencing price action. Any noticeable reaction is likely to be duplicated by post-open reports, of which there are several. Two Fed speakers help to keep the day focused on Friday’s report.
MBA Mortgage Applications
7:00 AM ET
*ADP Employment Report
8:15 AM ET
*James Bullard Speaks
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 Petroleum Status Report
10:30 AM ET
*Loretta Mester Speaks
11:00 AM ET
Afternoon Bias
| TUE afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 2597.75 | 2598.75 |
| …would target | 2607.25 | 2608.25 |
| Bias-down: under | 2581.00 | 2582.00 |
| …would target | 2572.25 | 2573.25 |
| 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.