Posts by Rod David
Market Wrap (recording & summary)
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Higher and higher highs don’t make a durable rally. An uptrend, perhaps. But not maintaining a higher high through that timing window’s exit is only distribution. And eventually distribution produces a downtrend.
None of Thursday’s attempts to reinstate Wednesday’s failed Pivot Reversal had been maintained through a timing window’s exit. The two intraday failures each resolved down sharply. Despite bouncing into Thursday’s close, no prior high was recovered.
Distribution. And “unfinished business above” at 2436.00 was neutralized in the process.
More so, sellers gained traction by exiting the bias environment under the noon hour’s low, and then entering the final hour lower. Gapping up above the 2433.75-2436.75 prior highs and extending higher would invalidate the downside traction. Otherwise, the next lower objective in-play is 2419.25.
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 Jun Contract (EC, ETF: (FXE, UUP))
Thursday’s reaction to the ECB policy statement was muted, but it triggered a signal under 1.1235. A second consecutive lower close on Friday would confirm the trend has reversed down. Closing back above 1.1285 would instead launch a new upleg.
Gold Aug Contract (GC, ETF: (GLD))
The corrective potential down to 1285.00 was fulfilled overnight to gap open there Thursday. That was already $8-9 of selling. Then came a $12-13 plunge down to 1273.50. So, an Island has formed from two sessions instead of from only one. It requires eventual retest and fresh highs above 1300.00. And it’s recovery is likelier sooner rather than later so long as 1269.50 holds as support.
Silver Jul Contract (SI, ETF: (SLV))
Wednesday’s overnight dip had filled the gap back to Friday’s 17.55 close. Thursday’s deeper pre-open dip repeated it unnecessarily, before post-open action plunged under 17.30. Closing above 17.40-17.45 keeps alive near-term potential for recovering, and for extending to fulfill 17.90.
30-year Treasury Sep Contract (US, ETF: (TLT))
The reaction down from Wednesday’s fulfillment of 154-10 extended deeper Thursday morning. Support was found upon testing the rally’s 153-29/154-02 objective. Its test presents a good opportunity for small bounce to 154-24 for correcting this week’s dip, where a durable downleg would be more credible to begin without suddenly accelerating its pace.
Crude Oil Jul Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Gapping down slightly Thursday to a fresh low under 45.30 was recovered immediately back into positive territory. Now filling the gap from above would neutralize its attraction below, which would be bullish if avoiding a second consecutive lower close confirming Wednesday’s breakout.
Natural Gas Jul Contract (NG, ETF: (UNG, UNL))
Thursday’s EIA report wasn’t being greeted from a position of strength due to the gap outstanding from Monday’s 2.98 low close. The knee-jerk reaction blipped-down to fill the gap, and then reversed back up into positive territory.
Mid-day Update… Try, try, try, again and again and.
Another fresh high. Another rejection.
Holding a test of this morning’s 2433.25 bias-up signal had put into play an offsetting test of its 2425.75 bias-down signal.
That was fulfilled as the first hour was ending.
That’s also when the Comey hearing had elapsed beyond the point where any new revelation or refutation was going to emerge. And the market rallied straight up into the noon hour’s 2436.75 high.
The noon hour’s high was another probe above prior highs. But it hadn’t yet developed when the noon hour was entered, i.e. when the bias environment was lapsing. And the noon hour’s exit was still overlapping prior highs. The afternoon bias environment’s entry rejected the fresh high altogether.
This afternoon’s no-bias environment has bounced back up to its 2432.75 bias-up signal. Probing it when the bias environment begins lapsing would be credible for extending higher. Any earlier would be no-bias trending and likely to fail. And already starting another downleg by then remains possible.
Look ahead: Economic Calendar – for Fri Jun 9, 2017
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: An unusually bare econ calendar leaves Friday’s session fully exposed to non-economic elements. At least, domestically.
Wholesale Trade
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 | 2435.25 | 2432.75 |
| …would target | 2440.00 | 2437.50 |
| Bias-down: under | 2430.25 | 2427.75 |
| …would target | 2423.25 | 2420.75 |
| Signal status: LATE NO-BIAS, TESTED BIAS-UP SIGNAL | FAQ | |
| INTRO VIDEOS #1 and #2 | ||
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.