Posts by Rod David
Market Wrap (recording & summary)
Friday’s open quickly slid back down from Thursday’s flat 2294.00 close to Thursday’s 2289.50 low. Even another point lower. The open’s dip proved too shallow to have stretched the rubber band enough for it to snap back up much. But sellers were kept at bay anyway, as a bounce up to 2291.25 split the morning.
Another dip attacked 2287.00 before bouncing back up into the noon hour. And lke the post-open ongoing series of lower lows and lower highs preceding it, another dip reversed to the morning’s low. Being so late in the session and difficult to generate sponsorship, the morning’s low was only pierced, and only by an errant tick.
Sellers simply weren’t strong-handed, which tends eventually to be bullish. Meanwhile, strong-handed buyers weren’t found at either Thursday or Friday’s lower lower. That tends to require a more aggressive downdraft. Alternatively, gapping up sufficiently Monday could already resume the rally.
Resuming the rally might only mean probing fresh highs, and then collapsing. The “new Globex trend extreme” left outstanding at 2299.50 doesn’t make the close any likelier to have extended higher. Thursday’s failure to confirm Wednesday’s breakout was a missed opportunity for entrenching the rally. As was the failure to produce a new trend high close on Friday despite being within proximity.
It’s almost as if this rally no longer wants to be entrenched. Which only undermines the effect of fulfilling attractions above — meanwhile, their attraction remains intact. Intact, and likely to be met next, so long as a gap down under 2275.00 “lower prior highs” is avoided.
Details and other markets coverage are discussed in the post-market Wrap recording here.
THERE IS NO SATURDAY REVIEW THIS WEEKEND. SEE YOU SUNDAY NIGHT!
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))
A slightly lower low under 1.0690 overnight had recovered before Friday’s GDP and Durable Goods triggered a surge. The bounce should hold 1.0760 to maintain potential to break durably under 1.0690.
Gold Feb Contract (GC, ETF: (GLD))
Probing lower overnight still recovered Friday to hover at or above 1184.50. Having held its support for two consecutive sessions, a corrective bounce to 1195.00 and possibly 1209.00 remains possible.
Silver Mar Contract (SI, ETF: (SLV))
Piercing the 16.75 sell signal only slightly deeper before and after Friday’s open was rejected by a morning surge that filled the gap back up to Tuesday’s 17.15 close, keeping alive potential for an eventual fresh trend high close above 17.27.
30-year Treasury Mar Contract (US, ETF: (TLT))
Thursday afternoon’s bounce was extended Friday, quickly testing 150-10, which contained the balance of the session. The bounce remains likely to be only temporary, before resuming its substantial decline.
Crude Oil Mar Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Friday’s opening dip immediately pierced the new 53.20 sell signal, eventually breaking lower to the 52.50 sell signal that had narrowly avoided triggering Wednesday. Extending under 52.25 would confirm the next downleg is underway.
Natural Gas Mar Contract (NG, ETF: (UNG, UNL))
Thursday’s failed breakout attempt above 3.40 was retraced a little deeper overnight, and then more so intraday Friday to test 3.25. Its reaction was substantial, closing back above the 3.34 sell signal, which remains in-play.
Mid-day Update… Noon hour avoids fresh lows.
It’s 1:30. Do you know where your reversal is?
This morning’s bias environment eventually included a blip-down to 2287.25. As with all blips, it was retraced quickly back up within the range. Sellers did not gain traction.
The reaction up only pierced the bias environment’s 2290.75 high. But that was a higher high, which upset the post-open decline’s series of lower lows and lower highs. One exception does not make the rule, and a trend reversal still needs one more higher high above 2291.25.
Meanwhile, there has been no lower low. If the market is a rally tinderbox, and a higher high would be the match, then a fresh under 2287.25 low would be the rainstorm that prevents a rally from catching fire today.
Look ahead: Economic Calendar – for Mon Jan 30, 2017
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: Monday’s Housing sector report follows last week’s five reports, so any reaction Monday will be a function of the prior week’s action. No other reports Monday have a track record for influencing price action.
Personal Income and Outlays
8:30 AM ET
Pending Home Sales Index
10:00 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 | 2297.75 | 2293.25 |
| …would target | 2303.25 | 2298.75 |
| Bias-down: under | 2291.00 | 2286.50 |
| …would target | 2285.50 | 2281.00 |
| 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.