Posts by Rod David
Afternoon Bias
| THU afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 2734.75 | 2734.25 |
| …would target | 2741.00 | 2740.75 |
| Bias-down: under | 2722.75 | 2722.50 |
| …would target | 2741.50 | 2714.00 |
| Signal status: BIAS-DOWN, BIAS-DOWN TARGET MET | 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… Isolated sellers.
Gap up holds on.
The overnight recovery from fresh lows was already stretching the room for noise around resistance. Pre-open testing of the 2710.25 bias-up signal extended sharply post-open. 
The 2722.75 bias-up target was pierced by 1 tick during the opening 15 minutes of volatility. Remaining above yesterday’s lows for that long completed the Isolation setup.
Already fulfilling the target created the opportunity for launching a new downleg. In fact, fresh post-open lows into the top of the hour tested 2708.00 as support. Choppily overlapping around the 2710.25 bias-up signal ultimately resolved up. Ultimately, not gracefully or relentlessly.
Although already met, the bias-up target was just retested by 1 point up to 2723.75. Although already held, the bias-up target can be exceeded. This is still a bias-up environment. Being a bias-up environment, reactions down have room to test the 2710.25 bias-up signal as support.
It’s too late to reject the Isolation setup. So, reactions down should be absorbed, and the afternoon should extend the recovery — probably into the weekend and possibly out of it. Combined with having met and held the 2701.50 pullback target, a retest of Friday’s highs or higher is likely. By the same token, NOT extending higher this afternoon could become very bearish.
The First Trade & Pre-open Tour Recording… Pavlov’s dog got loose.
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…
Wednesday’s open was greeted at the overnight range’s upper-end. A choppy, wide overnight range, indicating flip-flopping between polarized opinions. a Tuesday afternoon’s sellers had gained traction, so not gapping up above a prior high would doom to failure any rally attempt. The open did rally, and then the morning, and finally the knee-jerk reaction to the afternoon’s FOMC Minutes, totaling 23 points from the open up to 2747.00. The bias environment exit reversed polarity, apparently delivering quite a shock as the balance of the session plunged 47 points to test the next lower objective down to 2700.00.
Overnight action’s new info…
Extending down to 2693.50 through the futures close initially fell further to 2682.00 through the Globex open. Gradually recovering through the night greeted the Globex opens back at 2693.50. Cautious strength has gotten more daring, now having extended up to 2708.75. That’s back above Tuesday’s late low, and stretching the room for noise around a 61.8% retracement of yesterday’s last downleg (the post-position-squaring window). It’s resistance.
If, then…
Haven’t three consecutive rejected early rallies yet conditioned the market not to rally early? It seems that one of Pavlov’s dogs has gotten loose overnight, but he’s only reached the property’s fencing — resistance being tested by this overnight bounce. This could become an Isolation setup, by greeting Thursday’s open back within yesterday’s range and thereby isolating the probe under its lows to the overnight. Isolation setups tend to be durable reversals. Pavlov’s dog won’t hear the open’s bell if he’s already escaped over the fence. Ending the pullback from last week’s highs, whether to retrace the pullback or to resume the rally, in either case would rally today. Otherwise, not triggering the Isolation setup after fully forming it could be as bearish as the setup would have been bullish.
First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 under 2709.00would be unlikely to trigger the 2710.25 bias-up signal at 10:15. Exiting the open above 2701.50 would be unlikely to trigger the 2695.00 bias-down signal.
Morning Bias
| THU morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2710.75 | 2710.25 |
| …would target | 2723.00 | 2722.75 |
| Bias-down: under | 2695.25 | 2695.00 |
| …would target | 2683.00 | 2682.50 |
| Signal status: BIAS-UP, BIAS-UP 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.
Market Wrap (recording & summary)
Tuesday afternoon’s sellers had gained traction through the bias environment exit and the final hour’s entry. Gapping up enough Wednesday could have invalidated that traction.
Not gapping up enough would reflect weak-handed sponsorship and doom to failure any bounce.
Apparently, no matter how long that might take. We know, because Wednesday morning’s rally held up into the FOMC Minutes, and even extended on a knee-jerk reaction to it. That only exacerbated the rubber band stretch, which snapped back down as the bias environment began lapsing.
The afternoon peak tested its 2646.50 bias-up target by 1 tick while RSIs diverged negatively. Its reaction down collapsed to eventually probe the afternoon’s 2619.00 bias-down target and filled gaps back down to Tuesday’s 2714.00-2715.25 closes before correcting.
The afternoon collapsed again to retest oversold RSIs at Tuesday’s 2705.75 low. The next lower objective at 2701.50 was probed by 8 points down to 2693.50. Unless rejected immediately Thursday, a new downleg is underway. Meanwhile, the third consecutive day of morning rally and afternoon drop has likely conditioned buyers not to buy.
- Details and other markets coverage are discussed in the post-market Wrap recording here.
- Monitor overnight Globex trading in the chaRTroom here.