Posts by Rod David
Market Wrap (recording & summary)
Was the bearish WedEX’s influence mild? Post-open action and the balance of the morning trended down. The bias environment began lapsing at session lows. But it was only 6 points under the morning’s high, which doesn’t seem very aggressive. Of course, its sellers faced quite a headwind. Gapping up 20 points Sunday night and extending another 11 points higher. A lot of post-open buying was likely absorbed.
Regardless, the overnight rally neither inverted nor invalidated WedEX. And its influence lapsed by noon. Price action since that moment trended up 8 points to 2374.00, probing the morning’s high. But the opportunity to gain traction wasn’t exploited. Despite exiting the bias environment above the noon hour’s high, neither the final hour entry nor the proxy window trended higher. And that’s despite probing higher in the interim.
So, the big question is whether the 3-week old 2375.00 prior high will hold its test as resistance. It may yet be probed Tuesday morning. Or later, after a little deeper dip. Or, Sunday night’s test is all the retest it will get. In any case, closing above 2375.00 would be bullish, if not also being confirmed by a second consecutive higher close. And it may be the minimum requirement to avoid dipping to “lower prior highs” at 2348.00 and 2344.00.
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))
Sunday night’s gap up in reaction to French elections immediately tested the 261.8% projection of last week’s Pivotal Correction pattern. Friday’s gap down had held 1.0725 to avoid triggering its reversal. But now any further upside depends upon closing above 1.0905 and any lower close would be free to retest at least last week’s “lower prior highs” as support.
Gold Jun Contract (GC, ETF: (GLD))
Gapping down sharply Sunday night in reaction to French elections held 1266.00 and bounced to 1279.00 before Monday’s open. Another dip before the open also bounced, but no higher, and left potential for a fresh low to test “lower prior highs” at 1261.50 before launching a more substantial recovery.
Silver May Contract (SI, ETF: (SLV))
Gapping down sharply Sunday night nevertheless bounced back up to the 17.90 pullback limit that maintains potential for launching a new upleg, which would be triggered by closing above 18.05-18.10.
30-year Treasury Jun Contract (US, ETF: (TLT))
French election results triggered a flight from safety, and a 1-point drop at Sunday night’s open. The balance of the night fluctuated narrowly around the open, attracting no new strong-handed sponsorship. Monday’s intraday bounce recovered to test the rally’s 153-24 pullback limit. The gap back up to the 155-13 high close remains outstanding and likely to be filled.
Crude Oil Jun Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Fluctuating narrowly around Friday’s close Monday was also a test of the original buy signal’s 49.30 confirmation. Holding its test allows a corrective bounce to test “higher prior lows” at 50.55-50.65, which even the most bullish scenario would be unlikely to recover on a first attempt.
Natural Gas Jun Contract (NG, ETF: (UNG, UNL))
[Rolling coverage forward to Jun which trades at an 8-9 cent premium over May…] Monday morning initially probed fresh lows down to 3.12 under Friday’s 3.19 close. Although not all maintained, the second consecutive lower close confirms Friday’s trigger of the much-tested 3.22 sell signal.
Mid-day Update… What about last night?
Gap up still inhibiting sponsorship.
This morning’s post-open bounce up to 2372.00 was eventually reversed to probe under the open’s 2367.25 low. By 6 ticks. The effort persisted through the bias environment lapsing, which fulfills the bearish WedEX’s minimum requirement.
But its influence on Monday morning wasn’t aggressive, which is likely when Friday afternoon’s influence is muted. Regardless, its influence has lapsed, and now price action is subject to other influences only.
The afternoon bias isn’t stepping into that role. It just triggered no-bias, without testing either signal, but attacking the 2371.50 bias-up. Probing any higher before the bias environment begins lapsing in an hour would be doomed to failure.
No-bias trending would be doomed, but it could meanwhile extend to test the 2375.00-2377.00 overnight highs. No such test is required, and resolving down remains possible.
Look ahead: Economic Calendar – for Tue Apr 25, 2017
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: None of Tuesday’s housing sector reports is necessarily reliable for influencing price action. But releasing three almost simultaneously creates potential for contradiction or for confirming new extreme data. Meanwhile, after two pre-open reports are released in tandem, four are released in tandem post-open, which also enhances potential for a price reaction.
Redbook
8:55 AM ET
*FHFA House Price Index
9:00 AM ET
*S&P Corelogic Case-Shiller HPI
9:00 AM ET
*New Home Sales
10:00 AM ET
*Consumer Confidence
10:00 AM ET
Richmond Fed Manufacturing Index
10:00 AM ET
State Street Investor Confidence Index
10:00 AM ET
4-Week Bill Auction
11:30 AM ET
52-Week Bill Auction
11:30 AM ET
2-Yr Note Auction
1:00 PM ET
Afternoon Bias
| MON afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 2375.00 | 2371.50 |
| …would target | 2380.50 | 2377.25 |
| Bias-down: under | 2367.50 | 2364.25 |
| …would target | 2361.00 | 2357.50 |
| Signal status: NO-BIAS | 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.