Posts by Rod David
Mid-day Update… Hovering, not rallying.
Probing above resistance.
Look ahead: Economic Calendar – for Mon Feb 26, 2018
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: All of Monday’s econ reports are high-profile, but none have a track record for influencing price action. The pre-open Fed speaker does have such a track record, and the reaction to any comments would be more likely to be duplicated in reaction to the reports.
*James Bullard Speaks
8:00 AM ET
Chicago Fed National Activity Index
8:30 AM ET
New Home Sales
10:00 AM ET
Dallas Fed Mfg Survey
10:30 AM ET
Afternoon Bias
| FRI afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 2730.50 | 2729.75 |
| …would target | 2737.00 | 2736.50 |
| Bias-down: under | 2718.50 | 2718.00 |
| …would target | 2711.75 | 2711.00 |
| Signal status: NO-BIAS, TESTED BIAS-UP SIGNAL | 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… Hope sprung.
Maintaining does not equate to extending.
So, is the Isolation setup still in-play? Yes. Is it any more or less likely to be fulfilled. Less.
Gapping up was maintained through the opening 15 minutes of volatility, but it didn’t extend higher. An initially wide range between 2714-2723 narrowed gradually and slightly through the open, and through the 10:15 bias timing window. Every leg overlapped the 2721.00 bias-up target, but never with any complexity that would qualify as chipping away at resistance.
In other words, the market seems reluctant to rally. But it hasn’t yet collapsed in recognition.
This is a bias-up environment whose target is met and held. The likelihood continues to be against rallying. The bias-up environment could test its 2712.00 bias-up signal as support — it was just attacked to within 3 ticks. Breaking under 2712.00 when the bias environment is lapsing at 11:30 or within 10-15 minutes would be credible for extending down. Breaking under 2701.50 would likely be only a formality. Meanwhile, it’s still a bias-up environment, so trending up is still possible. Exiting the bias environment above 2721.00 would target a retest of yesterday’s 2731.00 high.
The First Trade & Pre-open Tour Recording… Last bite at this apple.
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…
Thursday’s open back within Wednesday’s range had isolated the probe under Wednesday’s lows to the overnight. This Isolation setup was completed when the opening 15 minutes of volatility had maintained the recovery and also trended up. Its 12-13 point surge to 2723.00 reacted down to 2708.00 and still managed another upleg to fresh highs that touched 2731.00 at noon. Then the three-day old pattern of rejecting early strength resurfaced. The balance of the afternoon trended back down, probing under the morning’s lows down to 2696.50. But that was still within Wednesday’s range to avoid invalidating the Isolation setup, albeit barely. Closing action bounced to close 2-4 points above the critical 2701.50 level that still allows this week’s decline to be considered a pullback from last Friday’s high.
Overnight action’s new info…
Thursday’s late bounce didn’t delay extending higher through the Globex open. Its first consolidation developed from just under 2715.00, and extended to attack 2728.00. Europe’s opens were greeted several points lower, on the way down to 2713.00, which has since bounced more than 10 points to attack 2724.00.
If, then…
The Isolation setup remained in-play yesterday by Wednesday’s lows holding as support. The fourth consecutive afternoon rejection of early strength failed to end in negative territory, also keeping the door open to reversing the recent trend. Of course, not recovering Wednesday morning’s 2716.00 low wasn’t optimal, but gapping up today could cure that by proxy. Last night’s bounce could be the beginning of the next upleg if it’s maintained above relevant resistance through the open — preferably above Thursday afternoon’s 2720.00 bias environment high or even Thursday’s 2731.00 noon high. And now having rallied overnight, a post-open rally would be doubly bullish for not attracting sellers and for still ignoring the four-day pattern of early rallies being rejected. Which necessarily means that not extending higher through the open could be doubly bearish. Fresh lows may be only a formality. More so, fresh lows would all but destroy the temporary pullback’s limited measurement. Friday Factors are likely to leverage either setup, whether to squeeze a post-open rally into a bigger recovery, or to help post-open sellers break through prior lows.
First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 under 2720.00 after touching it post-open would be unlikely to exceed the 2721.00 bias-up signal through 10:15 or to renew the bias-up signal. Exiting the open above 2715.00 would be likely at least to trigger the 2712.00 bias-up signal at 10:15.