Posts by Rod David
Market Wrap (recording & summary)
In yesterday’s Market Wrap, I asked whether last week’s interim pullbacks to 2563.75 refueled the rally to exceed its 2590.50 objective. The next higher objective at 2617.25 isn’t put into play until closing above 2590.50‘s room for noise up to 2600.75. Meanwhile, topping can test 2600.75, too. So, the two scenarios can be perfectly identical for awhile.
One clue is in the rally’s self-preservation techniques. Holding tests of 2563.75 was one, but that’s been done. Another is to create attractions above and then leave them outstanding as “unfinished business above.” A “new Globex trend extreme” was created Monday night, but it was neutralized as soon as was possible by the morning’s retest of it.
No unfinished business below was left outstanding, either. The morning’s reversal objective at 2583.50 was probed by nearly 3 points. There’s no live attraction in-play, the last attraction has been met and held, and a reaction down has held above relevant lows. So, Wednesday’s session isn’t likely to trigger a meaningful signal. So, trending Wednesday is likelier to be counter-trend. Another clue.
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 Dec Contract (EC, ETF: (FXE, UUP))
Fresh lows overnight and Tuesday’s gap down confirm that Monday’s fluctuation at the lows was not accumulation, and that the decline’s momentum remains intact.
Gold Dec Contract (GC, ETF: (GLD))
Monday’s surge was retraced overnight to its 1275.50 buy signal. It was probed as support Tuesday morning, fluctuating around it intraday, and must launch another upleg without further delay Wednesday to avoid a deeper pullback.
Silver Dec Contract (SI, ETF: (SLV))
Retracing Monday’s surge back down to the original 16.95 sell signal must still break lower to confirm Monday’s surge was only noise, and that 16.70 and 16.50 remain in-play.
30-year Treasury Dec Contract (US, ETF: (TLT))
Gradually probing another half-point higher Tuesday morning does not qualify as the aggressive behavior needed at this stage of the rally to prove it’s unlikely to only hold a retest of prior highs and then reverse down.
Crude Oil Dec Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Narrow sideways ranging consolidated Monday’s surge through Friday’s test of the rally’s 55.70 target. A second consecutive higher close was needed to confirm the rally is extending.
Natural Gas Nov Contract (NG, ETF: (UNG, UNL))
Slightly piercing Monday’s high overnight had reversed down to attack 3.09 Tuesday morning. Post-open weakness held a test of 3.09 before bouncing to probe more fresh highs attacking 3.18. Breaking under 3.09 any later than Wednesday morning would be less reliable for extending down to the pattern’s 2.94 target before extending the recovery.
Mid-day Update… Neutralizing sellers, too.
Pullback target met.
The open’s surge peaked upon touching the 2393.50 overnight high. Being a “new Globex trend extreme,” its intraday retest was required. Its reaction down was not.
But its reaction down was not noise. 
It rejected the 2591.50 bias-up signal that had been in a position to trigger. And that put into play an offsetting test of its 2583.50 bias-down signal.
Just that suddenly, unfinished business above was replaced with unfinished business below. And almost just that quickly, the unfinished business below has been neutralized, too. Sliding into the noon hour fulfilled the objective, and it was soon probed down to 2580.75.
But another attraction above has not been created. Not gapping up this morning means the open doesn’t require being tested from below. And this afternoon’s bias-up signal wasn’t triggered — it wasn’t even attacked. A 6-point bounce off the low is still several points into negative territory, and expending buying pressure.
The rally could get back on track. One way would be to exit the bias environment back in positive territory above 2588.00-2588.75, which would be credible for extending higher through the close. Meanwhile, bouncing without gaining traction keeps the pattern vulnerable to another downleg.
Look ahead: Economic Calendar – for Wed Nov 8, 2017
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: This week’s otherwise slow econ calendar is almost its slowest on Monday, with only MBA mortgage apps well before the open.
MBA Mortgage Applications
7:00 AM ET
EIA Petroleum Status Report
10:30 AM ET
10-Yr Note Auction
1:00 PM ET
Afternoon Bias
| TUE afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 2592.75 | 2589.50 |
| …would target | 2598.75 | 2595.75 |
| Bias-down: under | 2584.50 | 2581.50 |
| …would target | 2578.25 | 2575.00 |
| Signal status: NO-BIAS, TESTED BIAS-DOWN SIGNAL | FAQ | |
| 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.