Posts by Rod David
The First Trade & Pre-open Tour Recording… Sellers getting a head-start?
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 literally snatched victory from the jaws of defeat. The pre-open fresh low attacked critical 2813.00 support, but recovered back above Wednesday’s 2817.25 low to form an Isolation setup. Its reward would be to retrace the week’s ~2860.00 prior high. The setup gained confidence halfway through the opening 15 minutes of volatility, and from the entire open’s steep slope, if not also from extending higher through the first half-hour. A noon hour pullback resolved up to 2866.00 — already fulfilling the Isolation setup’s objective.
Overnight action’s new info…
Exiting Thursday afternoon’s bias environment ranged sideways through the close. The range persisted through the Globex open, dipping to 2856.00 by midnight. That was also a test of this morning’s 2857.25 bias-down signal, and its test produced a bounce back up to unchanged at 2862.50. A 30-minute drop fell down to 2847.25, which is still being tested as price hovers around this morning’s 2849.25 bias-down target. Interestingly, Zerohedge is reporting a favorable Trump China Trade comment, and it’s having only little near-term impact on price.
If, then… (notes to accompany the Tour recording)
Thursday afternoon’s no-bias trending has now been retrace to both its 2854.50 bias-up signal and 2852.00 1:20 print, which remained attractions below. The afternoon’s buyers had gained no traction for their efforts, so extending higher today all but requires gapping up, which isn’t currently indicated. Rallying anyway would be likely to fail, whether only from filling the gap back to yesterday’s close or probing yesterday’s highs. Meanwhile, the week’s earlier 3-day series of failed intraday rallies hasn’t indicated its demise, but it’s not yet clear whether the overnight dip is the start of its return, or if it’s just natural backing-and-filling after a multi-session outside day.
First Trade…
[Click here to view the Bias parameters] Exiting the open above 2861.00 at 10:15 would be unlikely to trigger the 2857.25 bias-down signal at 10:15. Exiting the open at 9:45 under 2854.50 would be likely to trigger bias-down. Exiting the open under 2846.00 would be likely to exceed the 2849.25 bias-down target at 10:15 to renew the bias-down signal
Morning Bias
| FRI morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2862.00 | 2867.00 |
| …would target | 2868.50 | 2873.50 |
| Bias-down: under | 2852.25 | 2857.25 |
| …would target | 2844.25 | 2849.25 |
| Signal status: BIAS-DOWN, BIAS-DOWN TARGET EXCEEDED | . | |
| BIAS VIDEOS… INTRO // EXAMPLE | ||
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)
Thursday’s open was teetering on the brink of collapse. Its pre-open probe of fresh lows attacked 2813.00 support, whose break would have triggered a drop into and out of the weekend. But a pre-open bounce recovered back above Wednesday’s 2817.25 low to suddenly introduce an Isolation setup into the mix. And it stuck.
Isolating the overnight probe was maintained halfway through the opening 15 minutes to signal the collapse had been abandoned. The entire open’s steep slope, if not also the first half-hour, told us the reversal was getting carried away and not to step in front of it. The noon hour was entered at 2856.50. The afternoon resumed the rally up to 2866.00 — already fulfilling the Isolation setup’s objective to retrace the ~2860.00 prior high.
The afternoon’s rally originated during a no-bias environment, requiring a retracement back to the 2854.50 bias-up signal or the 2852.00 1:20 print. Or, not. The bias environment lapsed above its 2860.25 bias-up target, so the requirement becomes only an attraction. But a very likely attraction.
Meanwhile, the afternoon’s buyers gained no traction for their efforts. The bias environment was exited above the noon hour’s range, but never confirmed. Extending higher Friday would all but require gapping up. Not gapping up would be unlikely to rally, but rallying anyway would be likely to fail. And the week’s earlier 3-day series of failed intraday rallies hasn’t indicated its demise.
Details and other markets coverage are discussed in the post-market Wrap recording here.
Monitor overnight Globex trading in the chaRTroom here.
REMINDER: THERE IS NO SATURDAY REVIEW THIS WEEKEND DUE TO TRAVEL
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 Jun Contract (EC, ETF: (FXE, UUP))
Wednesday’s surge was retraced had originated from a weak base that was likely to fail eventually. It wasted no time as Thursday retraced the surge’s origin, and triggering a sell signal under 1.1465. The gap back up to Wednesday’s close need not be filled, but it could be attacked up to 1.1500.
Gold Apr Contract (GC, ETF: (GLD))
Extending Wednesday’s post-close surge overnight gapped up sharply Thursday, but it was all retraced anyway back down to Tuesday’s close. The gap up above all prior intraday highs does create an attraction from below that would want to be filled before any durable reversal were credible.
Silver May Contract (SI, ETF: (SLV))
Gapping up Thursday held up relatively well intraday for being under pressure throughout. A second consecutive higher close Friday would confirm a new rally leg underway.
30-year Treasury Jun Contract (US, ETF: (TLT))
Wednesday’s surge extended higher Thursday, its second consecutive higher close from a multi-session range now confirming a bigger rally leg underway.
Crude Oil May Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Flat-to-lower overnight ranging was recovered Thursday to retest Wednesday’s highs. All price requirements have been met, so only a second consecutive higher close can confirm the trend remains intact.
Natural Gas Apr Contract (NG, ETF: (UNG, UNL))
Thursday’s EIA report was not being greeted from a position of strength. Not from a position of weakness, either, but that didn’t prevent dipping further under 2.84 to test 2.80. Back above 2.84 would once again signal a rally underway.
Mid-day Update… Betting on weak hands.
Strong hands aren’t buying here. Not, yet.
This morning’s bias environment ultimately extended through its 2842.00 bias-up target to 2856.50. The noon hour’s dip attacked 2846.00, then recovered to attack this afternoon’s 2854.50 bias-up signal. Which didn’t trigger, and was only touched at 1:30 to threaten invalidating the no-bias.
This is a no-bias environment, so its 2854.50 bias-up signal is likely to define the window’s upper-end. Extending above it would be “no-bias trending” and require being retraced. Which wouldn’t be surprising for a doomed rally to try, but it’s not necessary. The rally can wait until the bias environment begins lapsing before resuming.
And resuming the rally is likely, so long as 2848.75 now holds as support. Even then, the Isolation setup will’s reward retesting this week’s ~2860.00 high would still be likely tomorrow, which would be vulnerable to retracing the rally from this morning’s lows.