Posts by Rod David
Market Wrap (recording & summary)
Thursday’s intraday rally from 2248.50 eventually touched 2267.00. It gained traction by exiting the bias environment above the noon hour’s high, and then entering the final hour higher. But it didn’t recover Wednesday’s 2270.50 close, so the traction doesn’t prevent an interim drop.
The traction does help to absorb an interim drop, and to reverse it back up into positive territory. Otherwise, rallying would have required gapping up. Meanwhile the traction helps to limit an interim drop. A relatively shallow temporary dip could test 2257.50 or Thursday’s noon hour “lower prior highs” at 2254.25, and still recover.
A deeper pullback, and a delayed recovery, would still target 2247.50. It was attacked to within 1 point Thursday, but now actually testing it would be difficult to hold.
Details and other markets coverage are discussed in the post-market Wrap recording here.
Monitor overnight Globex trading in the chaRTroom here.
Mid-day Update… Bouncing back into almost positive territory.
Big rally off of morning lows is still negative.
Resuming the pullback to probe under Wednesday morning’s lows meant the next likely opportunity for a low would be Thursday afternoon. 
It’s now Thursday afternoon, and the afternoon bias environment is now lapsing.
The noon hour was already greeted rallying off of the morning’s 2248.50 low. Extending higher through the noon hour triggered bias-up, and its 2263.50 bias-up target is now being tested.
That’s 17 points of buying pressure, and its rally is only probing above the 2264.50 open. Which was itself a 6-point gap down. And while the rally is back above yesterday morning’s 2255.00-2257.00 prior lows, no prior high has yet been recovered. A lot of buying pressure to expend, only to still be in negative territory, fulfilling a target. Did I mention RSIs are deteriorating? No? RSIs are deteriorating.
Extending higher from here essentially requires immediately exploiting a few favorable factors. The recovery is an uptrend of higher highs and higher lows, which doesn’t reverse down on a tick. And, potentially, entering the final hour above the bias environment’s 2264.00 high would gain traction, and make reversing down today more difficult.
Above 2266.00 (being attacked now) could almost literally explode higher. Back under 2261.25 would start to suggest momentum is reversing back down.
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))
Wednesday’s wild intraday swing had recovered from probing under 1.0505 support to close back above 1.0605 resistance. But the resistance wasn’t a buy signal, so already gapping up to fresh highs Thursday is less bullish than first backing-and-filling. In fact, post-open action didn’t extend higher, and back under 1.0605 would start reversing the trend back down.
Gold Feb Contract (GC, ETF: (GLD))
Surging higher overnight extended higher Thursday to test 1207.00. The second consecutive higher close above a multi-session range now requires at least an eventual third higher close. That should visit 1212.00 or higher, before any durable decline would be credible.
Silver Mar Contract (SI, ETF: (SLV))
Thursday’s strength barely pierced last week’s 16.95 high, and didn’t close above it. That’s not bullish, and leaning bearish when compared to Gold surging. Back under 16.75 would now start to signal a deeper pullback underway targeting 16.15.
30-year Treasury Mar Contract (US, ETF: (TLT))
Fresh highs overnight attacked 154-00 but held the 153-20/153-26 bounce limit intraday. Closing any higher would have dismissed almost any further near-term downside potential. Dipping deeper into the close filled the gap back down to Wednesday’s 152-24 close, and closed under prior lows to keep in-play a topping pattern.
Crude Oil Feb Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Probing higher overnight to attack 53.25 was probed briefly intraday to prevent launching a new downleg. But the balance of the session did only range sideways instead of further extending Wednesday’s rally, making another downleg likely.
Natural Gas Feb Contract (NG, ETF: (UNG, UNL))
Gapping up Thursday reacted favorably to the morning’s EIA report, and pierced above 3.40. But that didn’t change whether the new had been greeted from a position of weakness, which prevented closing above 3.40, making a dip back down to 3.18 or 3.10 likely.
Look ahead: Economic Calendar – for Fri Jan 13, 2017
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: Two high profile econ reports start Friday, one each pre-open and post-open. The morning’s Fed speaker will cap a busy week of their comments, and follows the prior night’s appearance by Fed chair Yellen .
Janet Yellen Speaks
WED 7:00 PM ET
*PPI-FD
8:30 AM ET
Retail Sales
8:30 AM ET
*Harker Speaks
9:30 AM ET
Business Inventories
10:00 AM ET
*Consumer Sentiment
10:00 AM ET
Baker-Hughes Rig Count
1:00 PM ET
Afternoon Bias
| THU afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 2263.50 | 2258.25 |
| …would target | 2268.75 | 2263.50 |
| Bias-down: under | 2255.75 | 2250.50 |
| …would target | 2250.50 | 2245.25 |
| Signal status: BIAS-UP | 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.