Both bias signals tested.

[pay]Monday’s break wasn’t enough to force immediately lower prices, but it was enough to undermine any rally attempt. An overnight rally tested the 1270’50 bias-up signal before falling sharply to test the 1264’00 bias-down signal, each by 2 ticks. A recovery back to session highs took longer before failing, so its fall reached 1262’50.

Now a bounce is testing 1267’25. Back under 1265’00 would target 1260’50-1262’00 to retest the lows. Last week’s behavior at these levels might lure in buyers expecting another rally to begin. But we’ll be looking for the 1259’00 bias-down target, which might be 2 points too high.

If 1267’25 doesn’t hold this test as resistance, the market might be waiting for the econ reports due at 10:00 before reacting. No doubt they’ll be influential, but their timing might instead coincide with the morning’s low.

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