Posts by Rod David
Market Wrap (recording & summary)
What if. What if Thursday’s gap down proxy had not triggered, adjusting WedEX to bearish. Would its original bullish signal have been productive Friday? It’s a fair question, since the afternoon’s 2568.75 bias-up signal triggered, and the close surged to touch its 2573.50 target.
But that surge was last-minute. The bias environment’s 2571.00 entry was being probed down to 2570.00 within 3 minutes of the cash session close, when it mattered. And that would not have qualified as a bullish WedEX. So, we’ll still expect any early downtrending Monday morning to persist through the morning.
Meanwhile, fulfilling 2573.50 left no calculable “unfinished business above.” Wednesday morning’s outstanding bias-up target was fulfilled 10 points lower overnight. Thursday night’s “new Globex trend extreme” was a structural attraction that was neutralized Friday afternoon.
Now a new trend high close on a Friday has created another type of structural unfinished business above. It’s not a retest, but another new trend high close that is all but required — even if Monday were to begin a multi-session pullback. There’s more, and we’ll cover it during Saturday Review…
Details and other markets coverage are discussed in the post-market Wrap recording here.
This weekend’s Saturday Review starts at 9:30am ET. I’ll send the link in the morning.
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))
Wednesday’s 1.1830 close was tested overnight, but Friday’s open was higher. Nevertheless, the morning slid through it down to 1.1800, still likely resuming the decline and proving Thursday’s interim bounce was a detour.
Gold Dec Contract (GC, ETF: (GLD))
Thursday’s close above 1288.00 wasn’t optimal, requiring a second consecutive higher close. But Friday trended back down to retest the decline’s original 1280.50 target as support. Closing back above 1288.00 would still be credible for resuming the recovery rally.
Silver Dec Contract credible ETF: (SLV))
An overnight dip down to 17.11 extended down Friday morning to test 17.00 support. Now a clsoing above 17.30 is required to resume the recovery rally. But immediately recovering 17.11 would be credible for early warning.
30-year Treasury Dec Contract (US, ETF: (TLT))
Sliding overnight from Thursday’s close AT the 153-14 buy signal gapped down to Wednesday’s close at 152-20 lower prior highs. And then continued sliding through the morning to 151-25. The original pullback potential down to 151-18 that had been optimal to test before rallying is now a required test. And not holding it would suggest a new downleg underway. Closing back above 152-20 would put into play new recovery highs.
Crude Oil Dec Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
[Rolling coverage forward to Dec, which is trading at a 15-20 cent premium to Nov]. Extending down overnight back to the original 50.75 target buy signal coincided with uptrending pivotal support from the bottoming pattern, itself. Their near-term supportive influence reverse price back up into positive territory Friday morning, but didn’t assure the pullback had ended.
Natural Gas Nov Contract (NG, ETF: (UNG, UNL))
Fresh recovery highs overnight attacked 2.92, which was recovering into Friday afternoon. Thursday’s reversal back from a fresh trend low to close above a buy signal was premature, so restrained optimism like Friday’s pattern is constructive to a recovery next week.
Mid-day Update… An inverse Sisyphean task.
Pushing the boulder back down this hill is more difficult.
This morning’s 2569.00 bias-up target was being tested at 10:15 to avoid renewing the bias-up signal. A dip back down to the open’s 2566.00 low ran down the clock,
waiting for the morning to end.
Rallying out of the morning’s bias environment has extended relentlessly through the noon hour. Fresh highs are touching 2572.25.
The 2571.75 overnight high’s “new Globex trend extreme” had required an intraday retest, which is now done. Its retest was likely to include 2573.50. That’s also likely due to this afternoon’s 2568.75 bias-up signal triggering, putting into play its 2573.50 target. Its test can be neutralized by coming within 3-4 ticks, which is now done.
What about that bearish WedEX influence? Yesterday’s gap down was deep enough to adjust Wednesday’s bullish signal to bearish. Its influence either way is irrelevant until Friday afternoon. We’re here.
Probing fresh highs doesn’t contradict the bearish WedEX — not so long as the close has retraced the probe. The window was entered at 2571.00, so retracing it shouldn’t be difficult, mathematically. At least 1-minute RSI is diverging negatively, and there’s no “unfinished business above.” This being Friday afternoon, counter-trend sponsorship is difficult to attract. So, reversing should be obvious soon, if at all.
Look ahead: Economic Calendar – for Mon Oct 23, 2017
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: Monday’s Chicago Fed survey is the session’s only report, and it has no track record for influencing price action.
Chicago Fed National Activity Index
8:30 AM ET
3-Month Bill Auction
11:30 AM ET
6-Month Bill Auction
11:30 AM ET
Afternoon Bias
| FRI afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 2571.25 | 2568.75 |
| …would target | 2575.75 | 2573.50 |
| Bias-down: under | 2565.25 | 2563.00 |
| …would target | 2560.25 | 2557.75 |
| Signal status: BIAS-UP | 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.