Posts by Rod David
Post-open Review… Delay of game.
Testing bias-up, without triggering or rejecting it.
The overnight dip had touched this morning’s 2430.75 bias-down target. Twice. The retest’s reaction greeted the 8:30 econ report at the 2436.25 bias-down signal. The news triggered a surge.
That was within 1-2 hours of the open, suggesting its sponsorship is weak-handed. In fact, reacting down through the open touched the 2436.25 bias-down signal.
2436.25 reacted up to fresh highs at 2445.50. The 2443.25 bias-up signal was being overlapped at 10:15 to invoke the grace period. And it was being overlapped at 10:30 to avoid triggering or being rejected.
This is a noN-bias environment. Not a bias-up targeting 2450.50. And not a no-bias targeting an offsetting test of the already tested 2436.25 bias-down signal. It’s not usual, but it’s not abnormal. This morning’s bias environment need not be defined by its bias signals.
A fresh high would be likely to also test 2450.50. If sellers retake control this morning or coming out of this morning’s bias environment, then the balance of the session could trend down to new lows.
The First Trade & Pre-open Tour Recording… More fresh lows.
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…
Gapping down Thursday under Wednesday afternoon’s ~2463.00 low formed a “session-long decline” setup, which was confirmed by extending down through the open. All but one timing window probed the prior timing window’s low, the exception being the afternoon bias environment. It completed a bounce from 2442.75 to 2453.75. The balance of the session melted down to 2435.75. This brought the cumulative drop from Tuesday’s 2488.50 high to 53 points. Thursday was a breakout close, awaiting confirmation from a second consecutive lower close Friday. Thursday also formed a trend reversal setup, which would be confirmed by simply not closing Friday back above 2459.50.
Overnight action’s new info…
Globex has developed exclusively in negative territory. It immediately extended Thursday’s slide from the 2436.75-2437.50 close down to 2432.75. And then it immediately bounced back up to Thursday’s close, which resisted a narrow 3-point range all the way into Europe’s opens. That triggered an immediate dip, and after its quick retracement, a deeper leg fell to fresh lows touching this morning’s 2430.75 bias-down target. It reacted back up 4 points to the initial overnight range.
If, then…
The next lower objective is 2425.25, likely to be probed by at least 4 points. Any post-open weakness Friday would likely fulfill it intraday. The overnight dip to this morning’s 2430.75 bias-down target does make its break helpful confirmation — especially through the open, but through any relevant timing window. This being a Friday, the morning’s bias can persist through the noon hour. That could carry substantial consequences today, as nothing precludes extending through the day. Avoiding this morning’s bias-down signal (let alone renewing it), or exiting the morning in rally mode, may be the only opportunities to avoid trending down sharply into the weekend, and probably also out of it.
First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 above 2439.25 would be unlikely to trigger the 2436.25 bias-down signal at 10:15. Exiting the open under 2432.00 would be likely to trigger bias-down.
Phonetic dictation…
good morning good morning welcome it is Friday and all that that entails is Friday and we’re greeting the open of a Friday ahead of a weekend at a Friday factors when greeting the open in negative territory with a globe accession that is traded exclusively negative and maybe that scraped positive territory here a couple of times but yesterday’s drop is today’s session long to climb immediately extended down at last night’s open immediately extended really yesterday’s to climb a little bit relatively speaking a little bit three points to points and then ranged sideways quite a while quite a bit of sideways ranging overnight yesterday’s Cash session and Future’s closes 3675 3750 the fact that we served as resistance and we got to 38 so again exclusively a negative territory Europe’s opens right here one blip down retraced and then not recovering not recovering Europe’s down or reversing I should say recovering it but not turning positive as in sentiment indicator found that buyers just weren’t around found that sellers were pretty skittish and the market to a new level a new level it happens to be this morning’s biased and Target 3075 precisely touched just overlap it and then bounce would be sufficient and it was touched and then bounced back into the range momentarily nap trying to get back into that range everybody wants back into that range it’s not that wide of a range it shouldn’t be that difficult to get back to its upper end back above it right shouldn’t be that difficult what’s the holdup so more so if probing Above This overnight range into positive territory doesn’t begin until very close to the open let alone at the open so again within 30-45 minutes of the open if finally then and only then this overnight range is being probed whatever that were to produce would be temporary at least that would be our premise we’d expected to be temporary might trade it to the upside of might have measurements and suggested can put in and pretty significant balance but will surely be looking for it to Peak and forth at Peak to produce a new down leg potentially the new letters I mean let’s I don’t like to fear monger and referred to the you know the outside chances there’s always an outside chance of a crash there’s a pretty big inside chance of a crash today Friday factors Friday factors bill equidity for 2 days makes the market do interesting things and usual things that are very normal and repositioning ahead of two days of illiquidity can happen on a done so again bouncing back above the overnight range very late like an hour from now as we get much closer an hour and a half as we get much closer to the open just too late that’s fine too ship two unlikely to get a durable rally going if if there is too late of a probe of the overnight range but it does extend and maintain through the opening 15 minutes uh volatility maybe they can get it done we can ship that promise pretty quickly either way this is a Friday and Friday mornings by as tends to persist through the noon hour momentum is reversing up that can be pretty strong rally this morning this afternoon. Nothing that has anything to do with the rally momentum isn’t reversing up really that says that bias persisting through the morning through the noon hour could persist to the afternoon as well it could get ugly if it’s not rescued pretty much at the open right other markets so you’re not exploiting its narrow escape from death from breaking back in 1737 the longer that that persists without rewarding that the downside isn’t extending the more vulnerable to extending the downside that we’ve already crossed that Rubicon I think Looney interesting still probing lower lows intraday fighting them I can’t give this one any bigger benefit of the doubt other than to point out we’re still basically hovering a door under a prior low but the Buy Signal doesn’t change so I’ll just annoyed otherwise pound similar to The Looney different timing scraping Lowe’s new Lowe’s material and honestly wasn’t impressive it had Wednesdays drop had broken out and in Krogers being tested is only going to be one more bite otherwise .
Morning Bias
| FRI morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2445.50 | 2443.25 |
| …would target | 2452.50 | 2450.50 |
| Bias-down: under | 2438.25 | 2436.25 |
| …would target | 2433.00 | 2430.75 |
| Signal status: noN-BIAS, STILL TESTING BIAS-UP SIGNAL, TESTED 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)
Gapping down Thursday under Wednesday afternoon’s ~2463.00 low formed a “session-long decline” setup, which was confirmed by extending down through the open. All but one timing window probed the prior timing window’s low, the exception being the afternoon bias environment. It completed a bounce from 2442.75 to 2453.75. The balance of the session melted down to 2435.75.
That’s 36 points under Wednesday’s 2471.75 close, and 53 points under Tuesday’s 2488.50 high.
Thursday was also a breakout close. Tuesday’s temporary surge had closed back under the range’s upper-end, and Wednesday’s break had ranged choppily around its lower-end. A second consecutive lower close Friday would confirm the breakout, and require an eventual third lower close. Not closing Friday back above 2459.50 would also require an eventual third lower close. That was the interim low under which Thursday’s close has formed a trend reversal setup.
The next lower objective is 2425.25, likely to be probed by at least 4 points. Any post-open weakness Friday would likely fulfill it intraday. Or, Friday’s open may gap down under it and extend deeper into the weekend… and out of it. Of course, lower lows may be avoided altogether — albeit temporarily — by avoiding any post-open weakness.
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))
Still hovering at the 1.1730 “lower prior highs” isn’t necessarily tantamount to holding the test, especially when the test is a retest that strong buyers would have resolved up much sooner. .
Gold Dec Contract (GC, ETF: (GLD))
Avoiding a corrective dip to 1271.00, an overnight rally triggered a gap up Thursday through 1285.00 that extended higher through the morning to attack 1294.00. Upside momentum remains intact for extending to 1305.00 so long as 1285.00 holds as support. Under 1281.50 would signal momentum reversing down.
Silver Sep Contract (SI, ETF: (SLV))
Extending higher overnight without a pullback to 16.60 gapped up to test the 17.20 target and then react down to 17.05, which must hold as support to maintain the upside momentum.
30-year Treasury Sep Contract (US, ETF: (TLT))
A retest of Wednesday’s 155-08 high found its catalyst in the flight-to-safety that was triggered Thursday morning. Its resistance initially produced a reaction back under the 154-30 pullback limit. But more afternoon turmoil enabled an attack on the highs to avoid sealing a top instead, and to launch an extended upleg.
Crude Oil Sep Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Ignoring turmoil elsewhere since last week had created an extended narrowing range, a pattern which tends initially to break falsely in one direction before reversing more substantially in the opposite direction. Thursday’s gap up attacked the rally’s 50.10 target and immediately began reversing down back down to the range’s lower-end, just above the 48.25 sell signal.
Natural Gas Sep Contract (NG, ETF: (UNG, UNL))
Having sealed a bottom two days prior, Thursday’s EIA was greeted from a position of strength. Not so much as to preclude a knee-jerk reaction down from retesting the low, but to make that dip likely to recover into a rally. No test or recovery was needed, as the reaction spiked up and extended to fresh recovery highs attacking 3.00.