Posts by Rod David
The First Trade & Pre-open Tour Recording… Busy night.
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…
Volume was lower during Thursday’s session due to the Rosh Hashanah holiday. After a post-open plunge and its corrective bounce, the balance of the session ranged narrowly flat-to-lower. The morning’s bias-down left “unfinished business below” at its 2493.25 bias-down target. That was essentially redundant to already requiring a retest of oversold RSIs at Wednesday’s 2494.00 low. The 2499.00-2500.00 close was several points into negative territory, so the generally distributive pattern remained intact.
Overnight action’s new info…
Thursday’s sole trending attempt had been a knee-jerk reaction to headlines related to N. Korea. So was Thursday night’s sole trending attempt, more successful than just an attempt. New missile threats triggered a 9-point slide to ultimately touch 2492.00. Both Wednesday’s and Thursday’s “unfinished business below” at 2493.75-2494.00 were neutralized. That was well before midnight, and trending back up since then has recovered to yesterday’s 2499.00 cash session close.
If, then…
Wednesday’s low had formed where it did because of the support offered by last week’s 2495.50 “lower prior highs.” Retesting that support post-open is likely to break lower, at least 6 points to probe under 2490.00, potentially 10 points down to 2485.00-2486.00. Retesting Wednesday’s support overnight instead of intraday may have avoided all of that, but only if Friday’s open extends the rally into positive territory. The open is positioned to do just that, by having bounced back to unchanged from the overnight drop. So, not exploiting the recovery opportunity could be exponentially more bearish than if the overnight recovery had simply failed. Exploiting the recovery could be rewarded by probing new highs, potentially to a bullish new trend high close on Friday.
First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 above 2502.75 would be unlikely to trigger the 2498.00 bias-down signal at 10:15. Exiting the open under 2496.00 would be likely to trigger bias-down.
Phonetic dictation…
good morning and welcome it is Friday it’s time for Friday’s Morning Market to her interesting action overnight this is as we say in the states with a rubber meets the road basically we came into the session following yesterday’s Russia Shawna session with the Jewish New Year with a lot of participants right there and set volume is expected Lilo that didn’t prevent Post open plunge here just prevented it from extending or from recovering they didn’t recover and Charlie we didn’t get back to Wednesdays close entire session spent in negative territory not a productive session nothing predictive about it it did that would have probed under Wednesday’s low which already required to retest because of its simultaneously so really nothing new none of them didn’t change anything and buy anything I mean the ongoing distributor pattern and be the other internal observations we’ve been making that suggest things that there’s a pull back on speculation in favor of safety and some of those other things unfinished business Wednesday it doesn’t matter what the missile threats North Korea it was created by lower basically being the multi from the prior week numerical representation having already been influential likely to break through the lower end of that multi-session range which is 2490 well that would isolate and the balance of the session at least the morning with gravitate Trend up that would be the reward for having isolated this overnight programming neutralized the attractions below without in impacting intraday action for the open and consider the proximity to new highs to the highs the proximity says get just a little bit of a shove and there should be no problem probing new highs and this being a Friday new trend I close on a Friday in trenches the rally and suddenly all the other observations potentially barish observations become offset or neutralized countered doesn’t it sounds pretty even or neutral but it’s not because neutralizing barish influences actually is bullish Cuts both ways because considering the opportunity here to have isolated these retest for the retest of Wednesday the opportunity to have isolated to the overnight look at the 99 that overnight dip and if that is not exploited than the opportunity to produce new eyes becomes as much as it would have been bullish and it would have been pretty foolish could still be pretty boys so opening basically in positive territory at least through the open into positive territory that’s the beginning of a scenario for the day if not for the market rejecting this opportunity opportunity to recover this overnight opportunity not exploiting that also preferably not gapping down yet to significant or that closed we’re probably dropping potentially 85-86 999 Rudy’s in a in a bullish opportunity having held 81321 fullback it’s a retest having held at 80 80 closing but many 165 would be the last opportunity for this setup to prove that it has completed a pullback the pound bounced yesterday off of support that if broken under 1:35 would extend the pull back down to 132 certainly trying to avoid that and then they are see I don’t have any signal here it’s been pretty fast moving so for our opportunity in this venue just not anything that I’m going to be looking at trying to manage other than to point out a lot of pressure expended maybe from having stop pessimistically short of really thoroughly retesting its objective and it certainly was but not decisively before reacting not surprising precious metals in gold or silver we’re not looking for any kind of recovery to gain any traction any attempt at recovering already from this pattern is premature and doomed to failure the bond long blond really stretch this out just to its maximum maximum potential without falling off the edge of the world basically while still maintaining the potential for another correct there’s room it’s just noise otherwise crude oil and it would basically you can go back to that have already been tested their test already neutral are there support already neutralized so that creates a sort of an air pocket 975-4880 but the point is that we have a proxy here at 50 breaking under 50 essentially all but also breaking out of these lower prioritize and their price just under 50 basically without jeopardizing the rally and it’s not a good one and potentially totally destroying the pattern or if any of the distributive for this to maintain a good luck today.
Morning Bias
| FRI morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2506.75 | 2505.00 |
| …would target | 2512.75 | 2511.00 |
| Bias-down: under | 2499.75 | 2498.00 |
| …would target | 2494.75 | 2493.25 |
| Signal status: noN-BIAS, STILL TESTING BIAS-DOWN SIGNAL | FAQ | |
| INTRO VIDEOS #1 and #2 | ||
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)
Back at square-one. Perhaps not precisely, or numerically, But essentially. Thursday’s post-open plunge did manage to create a new objective below that remains outstanding. But its 2493.25 bias-down target would have been fulfilled by retesting oversold RSIs at Wednesday’s 2494.00 low. Essentially the same.
Any recent indications of a potential top would all but evaporate if the week ends in a new trend high close. That setup would entrench the rally, and the two setups should not coincide. Hovering just under the rally’s highs into the weekend isn’t very top-ish, either. So, a valid top may enter the weekend already in decline.
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))
Wednesday’s FOMC reaction ultimately extended down to 1.1917, completing a 61.8% retracement of the recent rally. The rally’s complete retracement to at least test it 1.1745 low is likely, while bounces hold 1.2025-1.2040.
Gold Dec Contract (GC, ETF: (GLD))
Greeting Wednesday’s FOMC from under 1318.50 wasn’t a position of strength. The reaction plunged to fresh lows that extended lower overnight and Thursday morning to 1291.20. Bounces should hold 1302.50 while the decline extends to test 1288.00.
Silver Dec Contract (SI, ETF: (SLV))
Hovering under the 17.30 buy signal Tuesday reacted down sharply to Wednesday’s FOMC, testing 17.00 support Thursday down to 16.88. Bounces should hold 17.30 before a bottom can form.
30-year Treasury Dec Contract (US, ETF: (TLT))
Wednesday’s attack on 153-14 support reacted up Thursday to test 154-16. The bounce had room up to 154-30 but reacted back down to unchanged. A retest of Wednesday’s low is likely signal before signaling the trend reversing back up, but also likely to hold.
Crude Oil Nov Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Wednesday’s failed probe of last week’s high extended down only slightly overnight, and ranged narrowly Thursday. Closing under 50.00 would be the first step to reversing the trend down. But any new high close above 51.00 would signal the rally is extending.
Natural Gas Oct Contract (NG, ETF: (UNG, UNL))
The pullback’s room down to 3.02 was tested soon after Thursday’s 3.07 open. The reaction to EIA extended down to 2.95. This seriously undermines the ongoing bottoming pattern, or at least its near-term potential to avoid a deeper drop to 2.84.
Mid-day Update… Still ranging.
Open’s dip retraces. Somewhat.
It’s not at all surprising that today’s lower-volume session remains range bound. It’s impressive that this morning triggered bias-down, and that post-open action trended aggressively. But the 2493.25 bias-down target remains outstanding. And the aggressive trending was due more to thin volume than to wide participation.
That latter point is why so much of the post-open drop was retraced into the morning’s bias environment exit. But the noon hour mostly ranged narrowly. A blip-down tried to trigger a sell signal under 2501.00, but only by 1-2 ticks before recovering to its 2503.00 origin.
This afternoon is now triggering no-bias, not even threatening either bias signal. There is no active sponsorship for trending either way, but beware of any knee-jerk reaction to news headlnies.