Posts by Rod David
Post-open Review… Opportunity knocked.
Several setups suggested selling’s subsided. One wouldn’t.
I’ve seen bigger paradigm shifts, but this one was still obvious. Overnight probing 5 points under yesterday’s low down to 2359.50 was recovered to greet the open 5 points into positive territory at 2370.00.
Extending 3 points higher to 2373.00 was retraced to 2367.50. Holding a test of the 2370.75 bias-up signal triggered no-bias, and put into play an offsetting test of the 2363.75 bias-down signal.
The no-bias signal can be rejected, without yet probing under the pre-10:15 low. One setup would recover the 2370.75 bias-up signal through 10:30. Another setup would recover the open’s 2373.00 highs upon exiting the bias environment at 11:30-noon. I’m monitoring for either based on these earlier setups:
Maintaining the gap up isolated the probe under yesterday’s lows, especially having touched the next lower objective of a multi-session decline, which likely reverses the trend back up.
The overnight low’s Symmetrical Triangle could have attracted price back down for its first break being false, but it had no influence during the opening 15 minutes.
Recovering 2372.00 through 9:45 would have made bias-up likelier to trigger. Its test wasn’t rejected by then. If the bullish setups I describe above don’t allow rejecting the no-bias, they could still help to absorb and recover from fulfilling the downside objective.
The First Trade & Pre-open Tour Recording… Last chance for gas.
Proper context can start the day with a solid win and make all the difference.
NEW 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…
Tuesday gapped down and probed fresh pullback lows at 2366.25. Holding the bias-down signal after the grace period put into play an offsetting test of the morning’s 2377.50 bias-up signal. A surge came within 3 points (not ticks) at 2374.75 before peaking, then retracing almost all of the recovery, leaving “unfinished business above.” And that was only the morning’s bias environment. Ranging sideways back up to 2372.00 almost lasted the balance of the afternoon. But the last half-hour slid briefly to test the next lower objective at 2364.00-2365.00..
Overnight action’s new info…
Despite bouncing into the close, Tuesday’s late break resumed steadily until touching the next lower objective at 2359.50. Ranging sideways formed a Symmetrical Triangle to greet Europe’s opens, which triggered a breakout that was retraced back to unchanged at 2367.50.
If, then…
Each session’s lower low reflects sellers expending more energy. So, the question is whether they’re gaining traction for the effort. Is this a temporary correction that will at least retest the highs, or is the trend reversing down. The last two sessions have closed back up within the prior session’s range, albeit closing negative. Obviously, that’s not a buy signal, as probing fresh lows continues. The “lower prior highs” being tested this week can launch a rally leg. But the window isn’t open indefinitely, and not yet exploiting the retracement can suddenly attract new sponsorship. Having probed under yesterday’s lows to a relevant level, isolating that to the overnight would be credible for launching a multi-session recovery. Otherwise, the trend may be reversing down.
First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 under 2362.25 would be likely to trigger the 2363.75 bias-down signal at 10:15. Exiting the open above 2368.25 would be unlikely to trigger bias-down. Exiting the open above 2372.00 would be likely to trigger the 2370.75 bias-up signal.
Morning Bias
| WED morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2371.50 | 2370.75 |
| …would target | 2378.00 | 2377.50 |
| Bias-down: under | 2364.25 | 2363.75 |
| …would target | 2358.25 | 2357.50 |
| 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)
Tuesday’s gap down held the bias-down signal to create an attraction above. After absorbing the anxiousness of an event in London, a steep rally attacked the upside attraction. But the 2374.75 peak stopped short of its 2377.50 objective before correcting. And correcting. And correcting.
A pullback to 2370.75 could have ended the correction, but it was probed down to 2365.00 when the bias environment began lapsing. The balance of the afternoon ranged sideways up to 2372.00. Until the last half-hour, which slid to the next lower objective at 2364.00-2365.00.
A lot of time has been spent in decline since last Wednesday’s high. And thanks to the height of that high, a lot of selling pressure has been expended only to test the prior week’s “lower prior highs.”
Of course, that was true enough after Monday’s close, but the selling didn’t stop. And Monday’s close back above the morning’s high didn’t prevent extending down Tuesday. Gapping up is still a credible path higher — and much likelier Wednesday than it was Monday, since “unfinished business” is no longer below. But if the decline is attracting new sponsorship Wednesday, then it should break quickly under 2359.50.
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 Mar Contract (EC, ETF: (FXE, UUP))
The 1.0585 bounce limit was probed Tuesday while testing 1.0570, and also testing uptrending pivotal support, whose break would target 1.0470.
Gold Apr Contract (GC, ETF: (GLD))
Gapping down Tuesday to fresh lows met the 1218.00 target and ranged slightly lower intraday. A bounce has room up to 1230.00, and the decline can meanwhile extend down to 1209.00 or 1198.00.
Silver May Contract (SI, ETF: (SLV))
The 17.55 target was met Tuesday by gapping down to fresh lows. A bounce has room up to 17.75 before starting to signal a rally underway. And there is meanwhile room to extend the decline to test 17.05.
30-year Treasury Jun Contract (US, ETF: (TLT))
Eking lower to 148-20 probed fresh lows still targeting at least a test of 147-10 with no reason to delay accelerating its move.
Crude Oil Apr Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Gapping up Tuesday retested the 53.58 sell signal as resistance, then reacted back down to unchanged attacking 53.00, still poised to launch a downleg.
Natural Gas Apr Contract (NG, ETF: (UNG, UNL))
Tuesday’s gap down at or under the 2.86 bounce limit was extended down to the 2.83 sell signal that put into play a retest of the two-week old 2.64 overnight low.