Posts by Rod David
Look ahead: Economic Calendar – for Fri Dec 23, 2016
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: Friday’s reports greet a relatively thinly-traded market, and only getting thinner ahead of the three-day holiday weekend. The post-open housing sector data may influence price if they seem far removed from recent sector reports. The Consumer Sentiment report is reliable for influencing price action, even if only to inhibit trending ahead of it.
New Home Sales
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 | 2260.25 | 2256.00 |
| …would target | 2264.75 | 2260.50 |
| Bias-down: under | 2254.75 | 2250.50 |
| …would target | 2249.50 | 2245.25 |
| 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.
Post-open Review… Sellers set the tone.
Opening plunge not rejected, but also not extended.
Retesting the 2260.25 overnight recovery’s high had reacted down to greet the open at 2258.50. That was not isolating the probe under yesterday’s low, which was the least bullish of the bullish scenarios. The only overt bullish scenario remaining would be to hold the 2257.50 bias-down signal’s test.
The post-open plunge to and through the overnight low down to 2254.00 didn’t make that easy. Or possible.
Ultimately, 2257.50 didn’t hold its test. And it also didn’t not hold its test. It was still being tested at 10:15 to invoke the grace period, and also at 10:30 when the grace period lapsed. This is a noN-bias environment. Not bias-down, and not no-bias.
noN-bias is still the least bullish scenario, but not necessarily bearish. Back under 2255.75 would start to signal the break extending, anyway. Further downside would be attracted to 2252.25, 2249.50, and possibly lower. Exiting the bias environment back above 2260.50 and preferably 2262.00 would be bullish.
Pre-market Tour (recording & summary)
The overnight recovery up to 2260.50 held its reaction down to 2257.50, and then retraced entirely up to 2261.00. Which would be very bullish if post-open action were to avoid negative territory and isolate the probe under yesterday’s lows to the overnight window. The recovery could be bearish otherwise for having refueled sellers, especially if the 2257.50 bias-down signal were to trigger.
Details and other markets coverage are discussed in the pre-market Tour recording here.
The First Trade… A pulse! (AND A SPECIAL NOTE)
Proper context can start the day with a solid win and make all the difference.
PROGRAMMING NOTE: TODAY’S PRE-MARKET TOUR WILL BEGIN 15 MINUTES LATE AT 9:10 AM ET.
CHARTROOM LINK
(pre-open Market Tour begins at 8:55 ET)
Through the prior close…
You thought Tuesday’s back-and-forth was interminable? Wednesday’s narrow ranging was insufferable. The open’s surge to 2268.00 was reversed quickly down to the pattern’s 2264.00 sell signal, which then defined the session’s lower-end. Its vulnerability was to the downside and to test 2260.50. Finally breaking lower upon coming to within 3 minutes of the cash session close did fulfill the test down to 2259.75 after the close. The drop neutralized lower attractions at Tuesday’s oversold RSIs from 2262.25 and the gap back to Monday’s 2260.00 futures close.
Overnight action’s new info…
Only the context of weak-handed sponsorship prohibited considering a hold-short. It was otherwise compelling, despite having fulfilled the 2260.50 downside objective. More relevant is the timing, and the lack of time to react off the target instead of closing at it. This often extends the leg, and it did last night, dipping as deeply as 2255.50. But bouncing since midnight eventually touched 2260.50, which is now trying to hold its reaction down to 2257.50.
If, then…
Probing overnight beyond yesterday’s intraday range should be either maintained or else rejected. In either case, actual trending this morning is likely. Maybe only this morning, if probably only this morning, considering the challenge posed by evaporating volume. Opening within yesterday’s range — and preferably above 2262.00 — could isolate the probe under it to the overnight. Alternatively, testing the 2257.50 bias-down signal would either hold and react up, or else break and trend down. The upside reward is to probe new highs above 2273.00. The downside reward could be 2249.50 and lower..
First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 under 2262.00 would be unlikely to trigger the 2264.00 bias-up signal at 10:15. Exiting the open above 2260.50 would be unlikely to trigger the 2257.50 bias-down signal.