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 Sep Contract (EC, ETF: (FXE, UUP))
Wednesday’s gap down to and through the 1.1945 sell signal could be confirmed by a second consecutive lower close, despite it being unlikely. Thursday’s pre-open probe lower in reaction to negative ECB comments tried making it likelier, which the afternoon’s favorable US Treasury comments retraced back up to unchanged and avoided confirming the sell signal.
Gold Dec Contract (GC, ETF: (GLD))
Wednesday night’s “flash crash” was recovered entirely back above the 1310.50 pullback limit and then reversed up through an adjusted 1317.00 buy signal. The 1319.50 pullback limit was recovered, too, essentially targeting a retest of Tuesday night’s 1332.00 high.
Silver Dec Contract (SI, ETF: (SLV))
Firming Thursday retraced 61.8% of Tuesday’s intraday reversal from its 17.69 opening gap, a gap that still needs to be filled as it was above all prior highs.
30-year Treasury Dec Contract (US, ETF: (TLT))
Narrow sideways ranging Thursday continued waiting out the market’s stability, barely reacting down to the lack of demand for a “flight-to-safety.” .
Crude Oil Oct Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Fresh lows overnight came within a dime of the 45.50 target but reacted up sharply to 47.35 Thursday morning. Back under 46.40 through Friday’s close may be the only way to resume the decline.
Natural Gas Oct Contract (NG, ETF: (UNG, UNL))
Thursday’s EIA was not greeted from a position of strength, but the pre-announcement dip to 2.91 was reversed back up sharply through 2.98 to fresh highs at 3.05. This suggests the bottom is complete, awaiting confirmation from a second consecutive higher close on Friday.
Mid-day Update… Safe for another day?
Opportunity to reverse down fails.
The gap up and its extension to 2469.50 had fulfilled the next higher 2469.00 objective. It also intersected with downtrending pivotal resistance off of July’s high. And it reacted down sharply — first, back to the open’s 2464.25 buy signal, and then to 2463.25.
That second, deeper dip was a second bite at a 2465.50 sell signal. It probed under the first test’s 2464.25 low. And it was recovered, entirely, back up through the noon hour to touch the morning’s 2469.50 high.
Sellers should be marginalized for the day, or at least until the final hour. Its proof would be in the rally should meanwhile extending higher. If buyers can’t exploit the opportunity, then the final hour would be that much more vulnerable to reversing down.
Already the afternoon’s no-bias signal triggered. Probing above its 2468.50 bias-up signal after 2:30 would go a long way to resuming the upside momentum. Otherwise, just hovering at the highs or briefly probing fresh highs would be vulnerable to collapsing into the close.
Look ahead: Economic Calendar – for Fri Sep 1, 2017
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: Employment Situation is usually released in a vacuum, with barely one other report nearby, let alone high-profile or influential. This Friday’s report is unusual probably due to Monday’s holiday. That’s likely to cause greater turmoil… and opportunity. But not necessarily after the noon hour, when those traders that even showed up are leaving early.
*Employment Situation
8:30 AM ET
PMI Manufacturing Index
9:45 AM ET
*ISM Mfg Index
10:00 AM ET
Construction Spending
10:00 AM ET
*Consumer Sentiment
10:00 AM ET
Baker-Hughes Rig Count
1:00 PM ET
Afternoon Bias
| THU afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 2469.25 | 2468.50 |
| …would target | 2474.25 | 2473.50 |
| Bias-down: under | 2462.75 | 2462.00 |
| …would target | 2457.50 | 2456.75 |
| Signal status: NO-BIAS, TESTED BIAS-UP 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.
Post-open Review… More than it could chew.
Open’s rally satisfies upside attractions.
The overnight rally to 2465.00 had corrected down to 2459.50 when the Euro tumbled.
But firming greeted the open at a 2463.50-2464.25 buy signal that I had identified in the chaRTroom.
Its first test bobbled. Its second test surged. The 2466.25 bias-up target was tested through the opening 15 minutes of volatility. Its eventual reaction down to 2464.00 was reversed up sharply to test 2469.00 by a couple of ticks.
1-minute RSI had been diverging negatively, and 3-minute RSI left overbought territory again. And 2469.00 coincides with downtrending Pivotal Resistance off of July’s high. A reaction down finally developed, touching 2464.25.
Maintaining a break under 2464.25 would likely open the floodgates to selling. It’s the low of an inflection point’s test at 2465.50. And there is no “unfinished business above.” The overnight range would likely be probed down to 2457.50, for starters.
Avoiding a deeper pullback this morning would maintain upside potential to 2477.00. Potential, not necessarily momentum — not without also entering or exiting the noon hour above 2469.00.