Posts by Rod David
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 Dec Contract (EC, ETF: (FXE, UUP))
Tuesday’s break back to prior lows didn’t extend through the close, which Wednesday morning’s bounce exploited. So did the FOMC policy statement, surging to test 1.1790 resistance. Back under 1.1750-1.1760 would likely resume the decline.
Gold Feb Contract (GC, ETF: (GLD))
Wednesday’s CPI report triggered a surge that firmed up to 1251.00 resistance, and the FOMC policy statement triggered another after the close testing 1255.50. Now holding 1251.00 as support would allow a recovery to form.
Silver Mar Contract (SI, ETF: (SLV))
No attraction or unfinished business below being in-play left a vulnerability to reacting favorably to CPI. Greeting the afternoon’s FOMC policy statement at 15.80-15.90 resistance reacted favorably to probe 16.05. Holding 15.90 as support would allow the recovery to become a rally.
30-year Treasury Dec Contract (US, ETF: (TLT))
Overnight weakness wasn’t any more productive than Tuesday’s intraday dip. The lower-end of the 152-18/153-10 range defined the open, and launched a rally to its uppoer-end in reaction to Wednesday’s CPI. The afternoon FOMC statement probed even higher, at least momentarily, while awaiting the Fed chair’s quarterly Q&A.
Crude Oil Jan Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Tuesday’s reaction to its gap up attacking 59.00 was reversed down to 56.80. Wednesday’s gap up also reversed down, probing under 56.80. Closing under it puts into play the 55.50 pullback objective.
Natural Gas Jan Contract (NG, ETF: (UNG, UNL))
Tuesday’s intraday rejection of its gap up had probed new lows, which were consolidated through Wednesday morning No new signal is available.
Mid-day Update… Weighting game.
Noon hour drop is extending ahead of FOMC.
This morning’s 2677.75 bias-up target became “unfinished business above” when left outstanding as the bias environment lapsed. The 2675.50 high was made as a knee-jerk reaction to a headline after the bias environment began lapsing. Its reaction down slid sharply as the noon hour began.
That’s not trending. Trending was already difficult ahead of this afternoon’s FOMC events. Retracing ground that was already covered doesn’t require sponsorship. Now sliding to within 1 point of this afternoon’s 2666.50 bias-down signal is awaiting 2:00 the FOMC policy statement.
Retesting the high — let alone the unfinished business above — is not required before more substantial selling begins. FOMC events can be a great catalyst for the volatility such a move would need. But 2677.75 can be left outstanding, so the chaRTroom will actively update relevant levels and setups during the events.
Look ahead: Economic Calendar – for Thu Dec 14, 2017
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: Thursday’s calendar is busy, and its reports are staggered. The pre-open reports are high-profile, but not reliably influential to price action. Meanwhile, BOE and ECB don’t often convene monetary policy meetings on the same day. And each is likely to be influential to price action, with Brexit and QE over-exposure concerns in the background, respectively.
Swiss monetary policy statement
3:30 AM ET
Bank of England policy statement
7:00 AM ET
ECB policy statement / Draghi Q&A
7:45 AM / 8:30 AM ET
Jobless Claims
8:30 AM ET
Retail Sales
8:30 AM ET
Import and Export Prices
8:30 AM ET
Bloomberg Consumer Comfort Index
9:45 AM ET
Business Inventories
10:00 AM ET
EIA Natural Gas Report
10:30 AM ET
Fed Balance Sheet
4:30 PM ET
Money Supply
4:30 PM ET
Afternoon Bias
| WED afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 2671.25 | 2674.25 |
| …would target | 2678.25 | 2681.25 |
| Bias-down: under | 2663.50 | 2666.50 |
| …would target | 2657.50 | 2660.50 |
| Signal status: NO-BIAS | FAQ | |
| NEW! 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… Not a care in the world.
The open probes new highs.
After recovering the overnight drop to 2659.25 back up to its 2669.00 origin, a pre-open pullback extended down to test 2665.00. At least a 61.8% retracement back into yesterday’s mid-day range was likely — essentially this morning’s 2671.75 bias-up signal. Fresh highs were also possible.
The open was greeted by already improving to 2671.25. Post-open action surged back into yesterday’s midday range, and then higher to 2674.50. New highs. Reacting down tested 2671.75 as support, recovering enough in time to trigger a clean bias-up. Its 2677.75 target is in-play.
That’s a lot of optimism ahead of this afternoon’s FOMC events. The overnight drop helped to create upside momentum, but that wasn’t intraday, and it has already been rewarded. Without the bias-up yet producing a fresh high since triggering, it is vulnerable to another detour. But the target above remains intact so long as 2671.75 holds tests as support.