Posts by Rod David
The First Trade & Pre-open Tour Recording… Sunday’s similar sequential setups.
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…
Thursday night’s relentless rally from 2782.75 had extended 20 points to 2803.00. And that was before a last-minute surge through the open extended to neutralize the “unfinished business” back to Monday’s 2807.75 opening gap. Obligatory resistance was expected, but its reversal nearly retraced all of Thursday’s close down to 2787.00 by noon. The balance of the session rallied back up to within 3 ticks of the open’s high, closing at 2804.50.
Overnight action’s new info…
Another last-minute Trump China trade tweet triggered a buying frenzy at Sunday night’s Globex open. Gapping up to 2814.00 quickly extended to attack 2820.00. I added a warning to the chaRTroom screen that since last week’s similar setup had held up and eventually extended this sequential Sunday’s similar setup would be vulnerable to reversing down. And the balance of the night has only trended back down, through midnight and Europe’s opens, probing below the earlier Globex low to 2809.50.
If, then… (notes to accompany the Tour recording)
Friday afternoon’s recovery was slightly less likely to reverse down immediately, likelier to first extend higher. Having missed the opportunity Friday morning for being satisfied with only an attack on last Monday’s 2814.00 high to 2812.50, extending higher had become likely to probe fresh highs up to 2817.50. So, Sunday night’s gap up has neutralized upside attractions. Being a similar setup to last Sunday suggests resolving differently by Monday’s open. This week’s instance lacks the complexity to form a “new Globex trend extreme” requiring intraday retest, but the setups are still comparable. I’ll be reluctant to sell prior to its retest so long as the open remains within the overnight high’s orbit, which begins above the open’s 2812.00 opening low. The area below it down to Friday’s ~2808.00 highs is a gray area, but exiting the opening 15 minutes any lower would be treated as a bearish Globex-flip — likelier to trend down this morning.
First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 under 2808.00 would be unlikely to trigger the 2809.75 bias-up signal at 10:15. Exiting the open above 2812.50 would be likely to trigger bias-up.
Saturday Review’s recording (for 3/2/19) …Burden of proof, or else poof.
The week ended back up where it had begun. And it began by gapping up to new recovery highs. But that gap up had created an anchor to ensure its recovery. That “unfinished business” above is now neutralized, and the week did not trend up. The rally can extend, but it needs a new signal. Meanwhile, it remains vulnerable to launching a deeper retracement. We discuss the parameters for recognizing either during this week’s Saturday Review.
The following stock requests were reviewed in this order:
CVS, NTNX, WDC, QCOM
transcript
—————– (03/02/2019 09:12) —————–
Rod David: -=-=-=-
—————– (03/02/2019 09:32) —————–
Rod David: Welcome to Saturday Review. Please post questions and comments as they occur to you.
Adam: Hi
—————– (03/02/2019 09:49) —————–
David B: Is there more of a chance that we break thru higher because of strong handed buyers on friday?
David B: i did not
Mark G: but the highest close on Fri requires at least one more higher close
Mark G: no link today
—————– (03/02/2019 09:56) —————–
Mark G: already answered
David B: do you believe this rally has been more of news of the fed and china and will be retraced?
Mark G: got resent
—————– (03/02/2019 10:04) —————–
David B: typically V bottoms are not durable and should be retraced?
—————– (03/02/2019 10:06) —————–
David B: what close would tell us we are headed to test the highs?
—————– (03/02/2019 10:09) —————–
Mark G: can get through 2860 perhaps temporarily by a positive China trade resolution
—————– (03/02/2019 10:10) —————–
Mark G: yes
Mark G: for sure a sell
David B: what close below would start to indicate were are starting to retrace part of this rally?
Mark G: trend change signal?
—————– (03/02/2019 10:15) —————–
jp: CVS,NTNX
David B: WDC,QCOM
—————– (03/02/2019 10:18) —————–
jp: if it should hold long term support back to 20132
—————– (03/02/2019 10:20) —————–
jp: yes 2013
—————– (03/02/2019 10:22) —————–
jp: is it recoverable
—————– (03/02/2019 10:25) —————–
jp: ty
—————– (03/02/2019 10:26) —————–
David B: has a low been put in for WDC?
—————– (03/02/2019 10:32) —————–
David B: Thanks
—————– (03/02/2019 10:34) —————–
Bill G: Thanks
Saturday Review Link – RESENDING
Be sure to join us by 9:30am ET for this weekend’s Saturday Review. After discussing the bigger picture and gaming out strategies for playing next week’s likelier opening setups, we’ll do instant analysis of any stock charts that you request… See you there!
Morning Bias
| MON morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2809.50 | 2809.75 |
| …would target | 2817.25 | 2817.50 |
| Bias-down: under | 2798.75 | 2799.25 |
| …would target | 2791.75 | 2792.25 |
| Signal status: LATE BIAS-UP, BIAS-UP TARGET MET | . | |
| 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)
Thursday night’s relentless rally had originated from its open retesting the 2782.75 low. Already having rallied 20 points to 2803.00, a last-minute surge through the open extended to neutralize the “unfinished business” back to Monday’s 2807.75 opening gap. Some resistance was expected, but not necessarily substantial. That didn’t prevent collapsing 20 points to essentially fill the gap back to Friday’s closes.
That was the morning. As with most Friday mornings, its effort tends to end there. In fact, the balance of the session repeated the overnight pattern of simply rallying relentlessly. And as with most Friday afternoons, exiting the bias environment above its noon hour high effectively marginalized sellers for the day. Not as reliably or productively as if also exiting the bias environment at fresh session highs, but reversing down would not be done by strong-handed sponsorship, if at all.
Friday morning’s 2808.25 high was attacked to 2807.00 before closing at 2804.50. Friday’s close is a new recovery high close, but still under prior sessions’ intraday highs, which would otherwise require another eventual new recovery high close. So, reversing down immediately would leave no unfinished business above.
Slightly likelier than reversing down immediately is to first extend higher. Stopping pessimistically short of the morning’s high Friday afternoon suggests probing higher anyway. That’s likely either to attack last Monday’s 2814.00 high to 2812.50, or probing it up to 2817.50. Slightly less likely is to reverse down immediately, attracted initially to Friday’s low where the delayed recovery didn’t isolate the post-open low to the bias environment.
Details and other markets coverage are discussed in the post-market Wrap recording here.
JOIN US FOR SATURDAY REVIEW AT 9:30 AM ET.