Posts by Rod David
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))
Thursday’s gap down to last week’s lows testing 1.0505 did not recover intraday, being likelier to extend down to the longstanding 1.0470 target.
Gold Apr Contract (GC, ETF: (GLD))
Thursday’s retracement of Wednesday’s bounce probed under its lows down to 1231.00. Just closing under 1238.00 suggests an actual downleg is underway, and not just noise within a range. A break lower would be credible, despite leaving outstanding an eventual third higher close that was signaled by last week’s confirmed breakout.. So, avoiding a break lower or its confirmation would be likelier to recover.
Silver May Contract (SI, ETF: (SLV))
Thursday’s early weakness easily held the past week’s 18.30 support. The afternoon did not, as price plunged to the lowest levels in three weeks at 17.70. Clearly, 18.70 is off the table, and no buy signal is imminent.
30-year Treasury Mar Contract (US, ETF: (TLT))
Wednesday’s break under 151-11 extended lower overnight and Thursday morning, confirming the trend change that now targets fresh lows.
Crude Oil Apr Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Gapping down and extending down Thursday offered the best opportunity in weeks to finally break the ongoing range, which had just failed to exploit to higher closes up to resistance.
Natural Gas Apr Contract (NG, ETF: (UNG, UNL))
Firming a little further ahead of Thursday’s EIA report wasn’t much upset in reaction. The bounce still has room up to 2.86 while still being likely to probe fresh lows under 2.64.
Mid-day Update… Creating distance.
Extended drop is countering yesterday’s rally.
Triggering this morning’s 2389.25 bias-down signal targeted 2384.25. It was tested down to 2382.50 as the bias environment began lapsing. So, the bias environment did not begin lapsing back above 2387.25-2388.25, which would have isolated the drop as being weak-handed.
No matter. Recovering the morning’s 2389.25 bias-down signal by noon would have isolated the drop, too. Nope. Bouncing into noon only attacked 2387.25, more than 2 points too low.
Each timing window that fails to recover a relevant level must recover a higher relevant level to signal stronger hands are buying. To signal strong hands are buying, and also that no lower objectives won’t be met.
The next lower objectives are “lower prior highs” at 2375.00, and the prior upside objective at 2372.25-2373.75. Deeper dips might still be avoidable by recovering the 2390.00 bias-up signal at the bias environment exit.
Look ahead: Economic Calendar – for Fri Mar 3, 2017
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: The month’s first Friday usually releases the new Employment Situation report, but that’s not the case this month. This might effect the market’s circadian rhythms to some degree, like by being volatile into the open. Fed speakers are more important Friday, being more prevalent — at least four are scheduled, they’re everywhere, like cockroaches.
Loretta Mester Speaks
Thu 7:00 PM ET
*PMI Services Index
9:45 AM ET
ISM Non-Mfg Index
10:00 AM ET
*Charles Evans and Jeffrey Lacker speak
10:15 AM ET
*Jerome Powesll speaks
12:15 PM ET
Baker-Hughes Rig Count
1:00 PM ET
*Janet Yellen Speaks
1:00 PM ET
*Stanley Fischer Speaks
1:00 PM ET
Afternoon Bias
| THU afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 2391.00 | 2390.00 |
| …would target | 2396.50 | 2395.75 |
| Bias-down: under | 2384.00 | 2383.25 |
| …would target | 2377.00 | 2376.00 |
| Signal status: NO-BIAS, TESTED BIAS-DOWN 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.
Post-open Review… Maxed out selling.
But potential for a rogue lower low.
Bouncing off the 2390.50 low up to 2394.25 greeted the open at 2393.00. Immediately, a spike down attacked the overnight low. After briefly pausing, 
another spike down probed a fresh low at 2387.75.
That’s within the 2387.25-2388.25 pullback potential that was put into play yesterday afternoon. Testing it wasn’t required, but its test is required to hold through a relevant timing window to maintain a near-term objective for fresh highs.
A fresh low has probed the 2387.25-2388.25 range’s lower-end by 1 tick. Meanwhile, the 2389.25 bias-down signal triggered.
Testing the 2384.25 bias-down target would necessarily probe under the 2387.25-2388.25 pullback limit. That won’t be any more bearish, so long as the bias environment exit is back above 2387.25, preferably above it, and above 2389.25.
Alternatively, bias-down could be invalidated. It’s too late to simply recover the signal through 10:30. But exiting the bias environment at 11:30-noon above the 2391.25 post-open high would suffice — so long as a print under the 2387.00 pre-10:15 low is avoided.
A deeper pullback could still recover, and likely would. So could taking longer to fulfill the bias-down target. One or the other would be likely if neither scenario described above has formed by noon.