Posts by Rod David
Market Wrap (recording & summary)
Was Friday’s bearish WedEX influential? The session contained a couple of productive downlegs. But the signal applies to the afternoon, and the afternoon’s downleg was largely retraced.
The morning had already trended down from 2352.00 to 2345.00. Bouncing reversed down suddenly at noon to attack the morning’s low. The noon hour’s exit broke sharply lower to touch the afternoon’s 2340.75 bias-down target. Pretty productive.
Bouncing to 2349.50 was triggered by news that tax reform is coming next week. That’s an artificial catalyst. And anyway, the bounce didn’t recover the noon hour’s high, so the intraday trend remained down. We’re assuming WedEX was mildly influential, which means that it should be very influential on Monday.
Friday’s drop retraced all of Thursday’s post-open gains. And since Friday’s low was at the obligatory support of Thursday’s 2341.00 gap open, the afternoon’s bounce is extra vulnerable to being retraced. Its break could open the floodgates. Meanwhile, the burden of proof is on the recovery to reassert itself.
Details and other markets coverage are discussed in the post-market Wrap recording here.
REMINDER: This weekend’s Saturday Review begins at 9:30am ET — I’ll email its link to you early in the morning. See you there!
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))
Filling the gap back down to Wednesday’s close didn’t prevent extending Thursday afternoon’s slide overnight. Gapping down Friday tested the 1.0725 buy signal that had been recovered Tuesday, and then ranged there choppily ahead of this weekend’s French election results.
Gold Jun Contract (GC, ETF: (GLD))
Firming Friday all but fulfilled the minimum likely objective at 1290.70, with potential also to fill the gap from testing the rally’s 1294.00 target before reversing down to and through 1274.00.
Silver May Contract (SI, ETF: (SLV))
Thursday’s test of 17.90 support was repeated Friday, and still being tested through the close, needing to recover 18.18 to launch another probe of fresh highs above 18.55.
30-year Treasury Jun Contract (US, ETF: (TLT))
Firming overnight and Friday morning to test at least 154-24 keeps alive the attraction to filling the gap back up to Tuesday’s close.
Crude Oil Jun Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Thursday’s consolidation of the 51.05 target that was met Wednesday was resolved down Friday morning to test 49.25, attacking the 48.90 buy signal that had originally triggered the rally to 53.55. The area is pivotal, and almost any strength maintained through Monday morning would target 51.05.
Natural Gas May Contract (NG, ETF: (UNG, UNL))
Greeting Friday at or above 3.13 initially continued the hovering there that had defined the week’s lows, but it broke lower into the afternoon. Unless 3.13 were recovered through Monday morning, the trend has now reversed down.
Mid-day Update… Yesterday, unwound.
Bearish WedEX isn’t hibernating.
This morning’s break tested all but 1 tick of its 2345.00-2346.00 objective. Reacting up to 2350.75 was reversed down immediately at noon.
Immediately, and substantially, back into the 2345.00-2346.00 range. Flat-to-higher ranging resolved down coming out of the noon hour. Substantially, plunging to touch this afternoon’s 2340.75 bias-down target.
Holding the bias-down target doesn’t renew this afternoon’s 2346.00 bias-down signal. But this is nevertheless a bias-down environment. And the afternoon’s bearish WedEX is apparently exercising its influence.
Yesterday’s 2341.00 opening print is obligatory support. Its break would next target filling the gap back down to Wednesday’s 2334.00 closes, and essentially 2327.25 below it. Recovering 2350.50 would be earliest to suspect a bullish resolution underway.
Look ahead: Economic Calendar – for Mon Apr 24, 2017
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: Neither of Monday’s two Fed surveys has any track record for influencing price action.
Chicago Fed National Activity Index
8:30 AM ET
Dallas Fed Mfg Survey
10:30 AM ET
3-Month Bill Auction
11:30 AM ET
6-Month Bill Auction
11:30 AM ET
Afternoon Bias
| FRI afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 2356.25 | 2352.75 |
| …would target | 2360.75 | 2357.50 |
| Bias-down: under | 2349.25 | 2346.00 |
| …would target | 2344.25 | 2340.75 |
| Signal status: BIAS-DOWN, BIAS-DOWN TARGET MET | 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.