Posts by Rod David
Market Wrap (recording & summary)
[Rolling coverage forward to Jun which presently trades at a 5.25 premium to Mar]…
Friday is not lacking for a catalyst to keep alive volatility and trending. It’s being greeted at fresh three-week lows, with a lot of downside momentum, and two days of illiquidity are fast-approaching. Should be fun.
Thursday night’s lowest lows in three weeks at 2766.75 basis Jun (2761.50 basis Mar) wasn’t the market hunkering down defensively ahead of the day’s ECB events. It was chipping away at support, as if any remained. Both the likelihood for attempting to isolate the fresh lows, and the likelihood for the attempt to fail, were already obvious before the open. A bounce barely attacked 2782.25 (2777.00) before beginning to collapse into and out of the open.
Simply by revisiting 2782.25 (2777.00) Wednesday, the next lower objective at 2758.75 (2753.50) was put into play. Thursday’s 10:15 bias timing window had blown through it to the collapse’s 2747.00 (2741.75) low. Stair-stepping back up to 2766.25 (2761.00) through the noon hour narrowly avoided triggering bias-up, which defaulted to begin trending back down to fresh session lows.
Fresh session lows began the trek to the next lower objective at 2739.00 (2733.75), encountering difficult support upon attacking 2743.25 (2738.00 basis Mar). Resolving down would next target 2727.25 and 2720.50 (2722.50 and 2715.25). That’s not necessarily in a straight line, ever — let alone ahead of the likely knee-jerk reaction to tomorrow’s Employment Situation report. There’s meanwhile room for noise up to 2758.75 (2753.50), and higher prior lows at 2775.25 (2770.00).
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 Mar Contract (EC, ETF: (FXE, UUP))
Before having another opportunity to trigger the 1.1350 buy signal, Thursday’s ECB events triggered a plunge to fresh relative lows. An immediate bounce would likely fail after Friday. Meanwhile, fresh lows into the weekend would be required to produce lower lows at some point on Monday.
Gold Apr Contract (GC, ETF: (GLD))
Another day of hovering at the lows, although early activity included a momentary fresh low. But its rubber band effect was too limited to trigger a reaction up, perhaps because of anxiousness ahead of Friday’s Employment Situation report.
Silver May Contract (SI, ETF: (SLV))
A blip-down to fresh lows Thursday held a test of 15.00 support before recovering back into the same narrow range of hovering at recent lows.
30-year Treasury Jun Contract (US, ETF: (TLT))
Wednesday’s attack on the 145-05 bounce objective didn’t require reversing down, and avoided triggering a sell signal before rallying again Thursday to the next bounce potential testing 145-20 by 5 ticks. That’s the week-old inflection point where the prior downtrend was launched under at least two supports, so it is also natural resistance. Its test is vulnerable to a reaction down, but meanwhile does greet Friday’s Employment Situation report from a position of strength that suggests an initial knee-jerk reaction down would recover.
Crude Oil Apr Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Another early test of the 57.00 buy signal Thursday was again unable to break higher. The week’s early downside test won’t be rejected without closing above 57.00, so early trending Friday would be likely to extend in that direction.
Natural Gas Apr Contract (NG, ETF: (UNG, UNL))
The reaction to Thursday’s EIA report was muted, despite not greeting the news from a position of weakness.
Mid-day Update… The long road back.
Steady corrective bounce does not equal durable recovery.
Since meeting this morning’s 2741.75 low, recovering through the bias environment ext and noon hour has touched 2761.25. But the 2758.00 bias-up signal was still being touched within 3 minutes of the 1:20 bias timing window, invoking the grace period.
It held, and this is a no-bias environment.
The decline isn’t required to resume today. But it would have potential to 2733.75 and 2715.00. If it resumes. Otherwise, the stair-stepping rally off the lows could extend into the bias environment’s exit.
Look ahead: Economic Calendar – for Fri Mar 8, 2019
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: Monthly payrolls doesn’t usually share its announcement time, let alone the spotlight, with another econ report. Often it’s the day’s only report. Friday’s other pre-open report is more high-profile than it is influential to price action, so that’s probably not relevant. The morning’s Fed speaker may be more closely watched in case of there having been a significant market reaction.
*Employment Situation
8:30 AM ET
Housing Starts
8:30 AM ET
*Mary Daly Speaks
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 | 2758.00 | 2758.00 |
| …would target | 2766.50 | 2766.50 |
| Bias-down: under | 2747.75 | 2747.75 |
| …would target | 2739.25 | 2739.25 |
| Signal status: LATE NO-BIAS, TESTED BIAS-UP SIGNAL — COVERAGE ROLLS FORWARD TO JUN AT THE CLOSE | . | |
| BIAS VIDEOS… INTRO // EXAMPLE | ||
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.