Posts by Rod David
Signals for ES on May 22, 2017
Although monthly expiration was Friday, its influence lingers through Monday morning. My proprietary WedEX signal had triggered bearish, and its influence began Friday afternoon. Its influence Monday morning was limited to retracing the open’s surge. The signal’s influence comes within view of lapsing at 11:15, which coincided with a buy signal triggering at 2388.00. Its 4-point rally was corrected, but resumed too late to be very productive.
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Morning Bias
| TUE morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2396.50 | 2395.25 |
| …would target | 2402.25 | 2401.00 |
| Bias-down: under | 2390.00 | 2388.75 |
| …would target | 2384.75 | 2383.50 |
| Signal status: NO-BIAS, TESTED BIAS-UP 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 up Monday to 2385.00 didn’t delay extending through Friday’s 2388.00 high. That was before the morning bias environment began. Extending much higher was delayed until the bias environment began lapsing. But it was worth the wait for a relatively quick move to 2393.25.
Then, another delay. But also worth the wait? Much of the noon hour, the entire afternoon bias environment, and also the proxy window, all ranged narrowly. The position-squaring window finally launched a break higher.
But that break was less than 2 points up to 2394.25. And it spent the proxy window only fluctuating around the noon hour’s high. Reacting back down to 2391.00 began too late to be serious, and was retraced back up to 2393.00.
Probing higher overnight has room up to the 2397.00 area before suggesting the rally will resume Tuesday. Otherwise, that Wile E. Coyote moment keeps the door open to greeting the open with a collapse.
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))
Trending up Friday made fresh highs likely Monday morning, but didn’t prevent their rejection. The gap up was maintained, just short of resistance at 1.0286.
Gold Jun Contract (GC, ETF: (GLD))
Gapping up Monday tested 2356.00, the level that had failed to support Wednesday’s reaction down from 2361.50 “higher prior lows.” Monday extended back up to 2361.50, which must be rejected Tuesday back under 1250.50 to resume the decline.
Silver Jul Contract (SI, ETF: (SLV))
Sunday night’s spike up through Wednesday’s high didn’t so much negate the Island pattern as ended it. Islands are always retested eventually, either to resume the trend or to end it. Holding the retest of Wednesday’s high would end the trend, which is the recent rally. Closing above it may seal a bottom, needing only the confirmation of also closing higher Tuesday.
30-year Treasury Jun Contract (US, ETF: (TLT))
Monday was greeted by firming that threatened to end the two-day consolidation and resume the rally. The gap back to the 155-13 high remains the objective.
Crude Oil Jun Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Gapping up Monday all but confirmed Friday’s breakout from a multi-session range. If not rejected immediately, then “higher prior lows” at 53.00 are in-play.
Natural Gas Jun Contract (NG, ETF: (UNG, UNL))
Gapping up Sunday night was maintained into Monday’s open, exceeding Friday’s 3.27 high and extending the detour on the way to fresh lows. The next opportunity to resume the decline would come from “higher prior lows” at 3.34.
Mid-day Update… Wile E. Coyote moment?
Don’t. Look. Down.
Double-topping this morning at 2391.75 didn’t prevent triggering the 2386.50 bias-up signal, or putting into play its 2392.00 bias-up target. But it did allow a pullback to test the overnight range down to 2385.00.
Firming into the bias environment exit extended into the noon hour, probing 2392.00 by 5 ticks. The balance of the noon hour ranged narrowly back down to this afternoon’s 2391.50 bias-up signal.
Bias-up didn’t trigger, nor was it rejected. This is a noN-bias environment. Trending either way is possible, but not common. Regardless, trending isn’t signaled.
This is an uncomfortable window not to have an objective in-play. Somewhat like Bugs Bunny’s nemesis Wile E. Coyote being led speedily off the edge of a cliff. 
His lateral momentum briefly suspends him in mid-air, before gravity takes over. The moment in between resembles this afternoon’s bias environment.
Back under 2389.50 would start to signal momentum reversing down. If confirmed and extended, 2381.00 and 2375.00 could be tested. Meanwhile, any bullish resolution won’t be signaled from under the 2393.25 high.