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))
Gapping down to attack recent intraday lows at 1.1780 then trended down through the morning to probe under 1.1760, potentially launching the next downleg except for the gap and higher prior lows now outstanding from the midweek consolidation.
Gold Dec Contract (GC, ETF: (GLD))
Thursday’s shallow gap up was soon retraced to test Wednesday’s close, possibly inhibited by anxiousness ahead of Friday’s Employment Situation report.
Silver Dec Contract (SI, ETF: (SLV))
Gapping up Thursday immediately began gravitating back down to Wednesday’s close, still attracted to the outstanding target below at 16.50.
30-year Treasury Dec Contract (US, ETF: (TLT))
Thursday’s early strength was soon reversed down by the outstanding requirement for at least one more new low close. The morning’s dip touched Tuesday’s 152-00 low ahead of Friday’s Employment Situation report.
Crude Oil Nov Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Thursday morning’s surge back into Tuesday’s range broke its 50.75 high which is also the pattern’s buy signal. Closing above 51.55 would confirm the 52.75 high will be retested.
Natural Gas Nov Contract (NG, ETF: (UNG, UNL))
Thursday’s EIA weasn’t greeted from a position of weakness, but neither was it a position of strength. So the knee-jerk reaction up to 2.99-3.00 resistance reacted back down into Wednesday’s range, with potential for filling the gap back down to Tuesday’s 2.89 close.
Mid-day Update… News-driven?
Good news triggers morning rally.
This morning’s 2537.00 bias-up signal triggered while its 2541.50 bias-up target was being attacked, and attacked, and attacked. A slightly higher high actually tested the target. Narrow ranging continued overlapping it until the bias environment began lapsing.
And then the rally extended. The suddenly steep slope suggests that’s where the rally actually began. Like yesterday, the bias environment lapsing trended straight up into the noon hour’s 2549.25 high. Unlike yesterday, there was actual news associated (House passes budget, inches closer to tax reform, surprising the recent gloomy opinion spin).
The balance of the noon hour and now this much of the afternoon bias environment have hovered at or under the 2549.25 high. Meanwhile, this afternoon’s 2547.00 bias-up signal has triggered.
Having expended so much buying pressure so quickly, the balance of the afternoon is vulnerable to backing-and-filling. Having created so much extra upside, pullbacks have room down to 2543.00 before threatening the chart pattern. But probing a fresh high — especially fulfilling this afternoon’s 2452.00 bias-up target — could trigger a pullback if not already done.
Look ahead: Economic Calendar – for Fri Oct 6, 2017
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: Friday’s Employment Situation report is often released in a vacuum, at least not surrounded by other reports. While only one other post-open report follows the pre-open payrolls, the session is littered with Fed speakers from late-morning throughout the afternoon.
*Employment Situation
8:30 AM ET
*Raphael Bostic Speaks
9:15 AM ET
Wholesale Trade
10:00 AM ET
*Eric Rosengren speaks on Saturday
11:45 AM ET
*William Dudley Speaks
12:15 PM ET
*Robert Kaplan Speaks
12:45 PM ET
Baker-Hughes Rig Count
1:00 PM ET
*James Bullard Speaks
1:50 PM ET
Consumer Credit
3:00 PM ET
Afternoon Bias
| THU afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 2549.50 | 2547.00 |
| …would target | 2554.50 | 2552.00 |
| Bias-down: under | 2543.25 | 2540.75 |
| …would target | 2536.50 | 2534.00 |
| 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.
Post-open Review… Chin up.
Pre-open new high extends post-open.
Maybe “extend” is too generous. Flat-to-higher seems to be more appropriate lately. Anyway, the overnight 2-point range broke a couple of points higher two hours before the open. Its 2539.75 high reacted down enough to overlap yesterday’s 2538.00 high at the open.
That was extended up to 2541.00, 2 ticks short of the 2541.50 attraction. Coming to within 2-3 ticks prevents it from becoming “unfinished business above” if left outstanding. It has been attacked twice, so ought to be touched regardless.
Meanwhile, 1-minute RSI is barely attacking overbought territory. Back under 2537.75 would signal momentum already reversing down. The trend otherwise remains up, but no less vulnerable to peaking.
PROGRAMMING NOTE: I am unavailable during the final hour today. Market Wrap will be recorded and emailed tonight, along with tomorrow morning’s bias parameters.