Bias-up target met overnight. More to come?

[pay]S&Ps have have only trended up since opening Sunday night. The high touched ESm 1385’00 where the large S&P contract peaked after Friday’s Employment report – that is also this morning’s bias-up target. I expect that to be probed be higher highs because since then price has ranged only 3 points lower, while MACD & RSI have pulled back without signaling momentum reversing down. Any time prior to the cash session retesting 1385’00, a dip down to 1379’00-1380’00 would likely recover.

But not too deep of a dip – when a bias target is met early, reversing back through its signal makes that become the reverse signal. In other words, now that the bias-up target has been met, falling back under the bias-up signal through 10:15am ET would be equivalent to a bias-down. This is despite a gap up at the open, because gapping up within Friday’s range won’t require retesting any higher high. This reverse signal could still develop after actually retesting the overnight high, which is still likely in any scenario.

Then maybe the market will answer the big question: Whether or not last Tuesday’s surge was the start of a larger upleg. Reversing the signal would be bearish enough to target Friday’s lows, and that would be bearish enough to trigger a deeper drop that reverses all of last Tuesday’s gain. Otherwise, maintaining the open’s gap up would be an appropriate way to resume the rally, presumably on the way to the ESm 1445’00 area.[/pay]