Posts by Rod David
The First Trade & Pre-open Tour Recording… On the brink.
Proper context can start the day with a solid win and make all the difference.
NEW 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…
Tuesday’s 6-point gap up to 2433.00 surged to quickly fulfill the minimum likely objective, which was to retest Friday morning’s 2439.50 high. The rally extended through the session — relentlessly and substantially, extending the open’s buy signal while holding every pullback limit’s test — up to 2454.00. A last-minute dip to 2450.50 held the 61.8% retracement from Wednesday’s 2474.00 high.
Overnight action’s new info…
The Globex open quickly touched what is this morning’s 2454.50 bias-up signal’s resistance, and then began reversing down. First attacking what is this morning’s 2446.00 bias-down signal, a 5-point bounce resolved down for its retest down to 2445.25. Its reaction has only bounced 3 points so far.
If, then…
Although a lot of buying pressure was expended and fulfilled yesterday, potentially completing a corrective rally, already trending down overnight is a little suspicious. The bias-down signal and a session-long decline setup are being threatened, but only being threatened at this point. And there’s room down to 2438.00 before confirming a new downleg has begun. Absorbing the overnight dip and not triggering either of the bearish opening setups could be rewarded by extending the corrective rally to 2461.00 today or tomorrow morning — at least by retesting yesterday’s high.
First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 under 2443.00 would be likely to trigger the 2446.00 bias-down signal at 10:15. Exiting the open above 2447.25 would be unlikely to trigger bias-up.
Phonetic dictation…
good morning welcome it is Wednesday it’s time for Wednesday’s Morning Market or it has pretty much been straight down overnight and it was pretty much straight up yesterday so just mirror images of the same price action not exactly yesterday’s straight up from back here 233 overnight had rallied substantially from about 26 had rallied substantially didn’t hang on but rallied substantially pulled back and Trigger to buy signal pretty quickly at 35 that pretty quickly. Jective of retesting Friday mornings High’s 2439 50 and kept going and going and going pretty much to the balance of the session was a late dip that closed 5125 5150 which just to put that in perspective this is last week’s high and 70 2474 which was a the mornings by step Target which test is the first time in today after having tested overnights 7173 50s corrective balance limit so yesterday’s clothes basically held a 61.8% retracement of that leg that damn leg nice natural correction not as silly the end of the road notwithstanding the overnight drop that since then since it’s bending all of that buying pressure intraday and actually let’s go one minute spending all of that since it was the sponsorship of one by or at least Down Under the bias environment slow with trigger a session long decline this already took some of that pressure off that late rally but you know is a session longer aliamanu still look at his bearishly and in the context of a session long decline if yesterday’s by its environment low his broken through the open so what 4625 4650 not triggering by here 30 minutes and then break up And loud saying and now firming further it failed to recover 1705 yesterday so I’m suspicious until it is recovered and even then needs a couple of consecutive higher closes to confirm that is not in the process of rolling over same thing with gold flirted with its 1288 cell signal and didn’t recover any relevant level it’s firmer overnight firming but not above any relevant level which would need to be recovered and then confirm that a second consecutive bases before that would be credible for overcoming the likelihood that is resolving down Longmont didn’t really give up within this range.
Morning Bias
| WED morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2455.50 | 2454.50 |
| …would target | 2462.00 | 2461.00 |
| Bias-down: under | 2447.00 | 2446.00 |
| …would target | 2441.75 | 2440.75 |
| Signal status: BIAS-DOWN, BIAS-DOWN TARGET MET | 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)
Monday’s choppy open had set into motion a series of conditions, each of which has developed through Tuesday’s rally. Monday morning’s temporary probe of fresh lows at 2415.75, and extending its recovery through Tuesday’s opening retest of Friday morning’s 2439.50 high, tracked the basic template. Not being rejected early kept the door open to rallying late. Which was done up to 2454.00.
Steep and relentless upside are common characteristics of counter-trending. The counter-trend’s actual size is relevant only to the leg it is correcting. So, whether rallying 38 points is a lot or a little matters far less than Tuesday retracing 61.8% of the last downleg (from Wednesday’s 2474.00 high).
Another interesting feature to Tuesday’s rally was its sponsorship. The open triggered a buy signal at 2435.00 and never looked back. There was no constructive backing-and-filling, or other tactics typically employed by a rally to refuel buyers. It’s less a characteristic of a correction, and more an accident waiting to happen.
Regardless, reversing down still requires an actual sell signal to trigger, and there’s room down to 2438.00 before confirming a new downleg is underway. Meanwhile, the corrective rally is otherwise free to extend higher, next targeting 2461.00.
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 Sep Contract (EC, ETF: (FXE, UUP))
Already reacting down overnight, Tuesday’s open again retested the 1.1765 sell signal, which continues to behave more as a magnet than as an inflection point.
Gold Dec Contract (GC, ETF: (GLD))
Overnight weakness tested the 1288.00 sell signal before bouncing. The bounce stopped short of recovering 1295.00, which makes another dip likelier to extend down.
Silver Sep Contract (SI, ETF: (SLV))
Tuesday morning dipped deeper to test the 16.90 sell signal. Reacting up sharply held the 17.05 pullback limit as resistance, all but signaling the trend is reversing down.
30-year Treasury Sep Contract (US, ETF: (TLT))
Monday’s inside-day was followed by another Tuesday morning, even while surging stocks seemingly offset the catalyst for last week’s flight-to-safety rally.
Crude Oil Oct Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Monday night’s bounce back up to 47.95 resistance was largely retraced into Tuesday’s open. But Tuesday morning’s bounce retested 47.95. Resistance held through the close, but can still resolve down Wednesday as EIA is being greeted from a position of weakness.
Natural Gas Sep Contract (NG, ETF: (UNG, UNL))
Surging before Tuesday’s open wasn’t extended above its 3.00 open, and reversed through the morning to 2.93, preventing a decisive close above 2.95 that would have closed the door to a deeper pullback targeting 2.81.
Mid-day Update… One-way street, in R.
Hovering at resistance.
This morning’s bias environment fulfilled the retest of Friday morning’s 2439.50 high. Actually, the open’s surge did that. The bias environment extended up to 2445.25. Rallying again at the bias environment’s 11:30 lapsing was bullish, and the noon hour extended up to 2448.50.
2448.50 is the afternoon bias-up signal. It didn’t trigger. But two reactions down were recovered entirely. Often, that resolves up anyway when the bias environment begins lapsing — whether or not durably.
This morning’s doubly-renewed bias-up target was 2446.00. So long as it holds pullbacks during the bias environment, at least an obligatory fresh high is likely. And it would likely touch 2450.75, regardless of its resolution from there. Back under 2445.00 would instead start signaling momentum already reversing down.