Posts by Rod David
Market Wrap (recording & summary)
2818.00 and higher was put into play Friday by closing above 2770.00, which had been put into play by closing above 2758.00. Actually, 2758.00 was first probed the same day, but it’s still the room for noise back under 2770.00. Closing under 2758.00 would invalidate any consequences for having closed above 2770.00.
2770.00 ultimately held its test through Tuesday’s close, or at least was being probed as resistance. It had been probed below down to 2762.50. Anyway, still testing 2770.00 at the close means the very late bounce didn’t recover a relevant level, and trended down into the close. So, gapping up above the afternoon bias environment’s 2788.50 high could form a “session-long rally setup”.
There’s plenty of upside to reward buyers. Tuesday morning’s 2794.75 bias-up signal was broken during the bias-up environment, requiring its retracement. And the Double Top with Monday’s high is a pattern that is often recovered by resuming the prevailing trend. Not to mention 2818.00.
A recovery is still possible from testing 2758.00. But there’s no bullish reason for any further backing-and-filling. So, delaying a recovery much past Wednesday’s open would suggest a bearish expiration sentiment.
- 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 recovery back up to the 1.2345 sell signal extended higher Tuesday, back up to the “higher prior lows” of the Tue-Wed range that had launched Thursday’s plunge. Back under 1.2330 would resume the decline.
Gold Apr Contract (jUN , ETF: (GLD))
Bouncing overnight held a test of 1325.50 resistance. Its complete retracement greeted Tuesday’s CPI unchanged. A wide $14 knee-jerk reaction ultimately resolved up to test and retest 1325.50 by several dollars. There’s still room up to 1335.00 before signaling a bigger rally underway, but that becomes only a formality if another downleg isn’t underway already Wednesday.
Silver May Contract (SI, ETF: (SLV))
An overnight bounce had retraced to unchanged ahead of Tuesday’s CPI, which triggered a spike up to 16.70. Which is still in the 16.50-16.75 range that avoids triggering a signal.
30-year Treasury Jun Contract (US, ETF: (TLT))
Tuesday’s 30-year auction was greeted by fresh highs testing 144-05 resistance up to 144-15. Reacting down a couple more times each recovered to the downtrending resistance. But closing beyond either would be likely to extend in that direction. Closing above 144-05 would be credible for extending higher, but back under 143-16 would signal a new downleg underway.
Crude Oil Apr Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Bouncing back up to the 61.35 bounce limit Monday didn’t recover it, so Tuesday’s break back down to Monday’s lows helps to confirm the downtrend has resumed.
Natural Gas May Contract (NG, ETF: (UNG, UNL))
Probing slightly higher highs overnight were retraced back to and/or under the 2.81 “lower prior highs” Tuesday, which keeps alive potential for a corrective dip.
Mid-day Update… Another hill to climb.
Unfinished business above is added to the higher targets.
Reacting down from 2807.25 down through this morning’s 2802.50 bias-up target had tried to hold support at the 2794.75 bias-up signal.
It failed. It had broken 10 points lower by noon, and extended another 10 points lower during the noon hour to 2774.00.
Bouncing to 2788.00 avoided triggering the afternoon’s 2780.75 bias-down signal. It’s being tested now anyway down to 2778.00. Being a no-bias environment, the 2780.75 bias-down signal’s test should define the window’s lower-end. Otherwise, probing under it will require being retraced.
Similarly, this morning’s 2794.75 bias-up signal’s test requires being retraced. Often, the 10:15 print at 2801.00 will be retraced, too. Back above 2784.50 would start to signal the retest underway, confirmed above 2788.50. Until then, the pullback is vulnerable to extending down further.
Look ahead: Economic Calendar – for Wed Mar 14, 2018
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: Mario Draghi speaks at a conference in Frankfurt Wednesday, which might reveal the market’s tone for the day. But the pre-open PPI is both high-profile and reliable for influencing price action. Retail Sales is announced simultaneously, but is higher-profile than influential unless very surprising.
MBA Mortgage Applications
7:00 AM ET
*PPI-FD
8:30 AM ET
Retail Sales
8:30 AM ET
Atlanta Fed Business Inflation Expectations
10:00 AM ET
Business Inventories
10:00 AM ET
EIA Petroleum Status Report
10:30 AM ET
Afternoon Bias
| TUE afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 2787.50 | 2792.00 |
| …would target | 2796.25 | 2801.00 |
| Bias-down: under | 2776.00 | 2780.75 |
| …would target | 2765.50 | 2770.00 |
| Signal status: NO-BIAS, TESTED BIAS-DOWN 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.