Posts by Rod David
Afternoon Bias
| TUE afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 2797.25 | 2797.50 |
| …would target | 2804.25 | 2804.50 |
| Bias-down: under | 2787.50 | 2788.00 |
| …would target | 2781.75 | 2782.25 |
| Signal status: NO-BIAS | . | |
| 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.
Post-open Review… Chop, chop.
First hour is contained by yesterday’s final hour range.
Be cautious with entries and sizing. This being a no-bias environment, there is no required attraction in either direction. And despite having probed yesterday’s late high overnight, yesterday’s final hour range has contained this morning’s opening range. Trending sponsorship is weak-handed, to
the degree there’s any, and not just noise.
Inflections in the chaRTroom have still been productive, albeit short-lived before reversing direction. One thing that continues to be unlikely is volatility remaining heightened, regardless of whether price action is contained within a relatively wide range.
The First Trade & Pre-open Tour Recording… Is yesterday’s elephant still in the room?
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…
Sunday night’s open had gapped up above all prior highs for the second consecutive week, triggered by a last-minute Trump China trade tweet, also for the second consecutive week. The rule of alternating resolutions ruled out extending higher. The overnight pullback from attacking 2820.00 to test 2810.00 still allowed for a post-open retest of the overnight high, but it was only attacked while fulfilling the morning’s 2817.50 bias-up target. Monday morning’s late bias-up signal didn’t prevent trending down sharply to exit the bias environment under its bias-down signal, negating a retest of the bias-up signal. Extending through the noon hour to 2767.50 encompassing all of the prior 6 sessions. The afternoon bounce retraced half of the earlier high-to-low drop, ending at 2792.00, and proving this rally has been probing thin air.
Overnight action’s new info…
Monday afternoon’s recovery up to 2794.50 began retracing back down through the futures close and into the Globex open, eventually attacking 2785.00. All of which was recovered to greet Europe’s opens back at 2794.50. Extending higher this time to 2799.00 is now trying to hold 2794.50 as support.
If, then… (notes to accompany the Tour recording)
Yesterday’s plunge was quite a shock to the system. That can inhibit and squelch volatility, but usually not until 1-2 days more of shock. And not necessarily in a straight line, or even back to either end of yesterday’s very wide range. The extended bounce described at yesterday’s close has developed overnight, but that doesn’t reverse the trend up. The greeting given the last two rallies up to 2803.00-2805.00 suggest peaking there if tested, without first having to be probed. Regardless, there is no “unfinished business” above, but that doesn’t necessarily resolve in an immediate collapse. Meanwhile, there was no bullish reason yesterday to revisit last Wednesday’s test of 2777.00 support, which now has less support if met again. Emphasis on “if met again,” since yesterday afternoon’s recovery did avoid a closing under Wednesday’s low, which Monday’s new high has made the new line in the sand for signaling a trend change.
First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 under 2795.50 would be unlikely to trigger the 2798.25 bias-up signal at 10:15. Exiting the open above 2800.50 would be likely to trigger bias-up.
Morning Bias
| TUE morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2798.25 | 2798.25 |
| …would target | 2805.50 | 2805.50 |
| Bias-down: under | 2782.00 | 2782.25 |
| …would target | 2774.50 | 2774.75 |
| Signal status: NO-BIAS | . | |
| BIAS VIDEOS… INTRO // EXAMPLE | ||
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)
The week began with setup examples from its opening tick. Sunday night’s opening tick, which duplicated the prior Sunday’s gap up above all prior highs. 
That alone would suggest its resolution will be different, since sequential similar setups resolve differently. But they even had the same catalyst. So, the night gradually pulled back from attacking 2820.00 to testing 2810.00.
Another example came from Friday’s attack on last Monday’s 2814.00 high. Attacking it up to 2812.50 could have sufficed, but the session reversed down sharply. The market tends to compensate for delays, so retesting 2814.00 became likely to be probed up to 2817.50. Which Monday’s open twice tested and held.
Like last Monday’s gap up above all prior highs, this week’s 2815.50 opening print would want to be retested from below. Last week’s interim dip took control of the week. Monday’s dip took about 20 minutes. Neutralizing its attraction along with the morning’s 2817.50 bias-up target opened a vulnerability to reversing down.
I had preferred waiting for the overnight high’s retest before considering a sell signal, but no “unfinished business” above made the potential whipsaw worthwhile. And there was only one whipsaw before collapsing from 2810.00 to 2768.00. The afternoon trended back up, retracing half of the post-open drop to 2792.00. Monday’s range encompassed all of the prior 6 sessions, proving this rally has been encountering thin air. Extending any higher overnight would be vulnerable to greeting Tuesday’s open back in decline.
Details and other markets coverage are discussed in the post-market Wrap recording here.
Monitor overnight Globex trading in the chaRTroom here.