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Market Wrap (recording & summary)
Monday’s 2534.00 open was testing Friday’s 2531.00-2533.00 close. So, essentially flat. More important was the open’s test of the 2532.00 earlier Globex low. Not holding above it, after having probed above Friday’s high, would form a Globex-flip setup and reverse down.
The open’s Globex-flip setup was challenged by Friday’s session-long rally setup, which already made Monday morning likely to probe higher. The reversal attempt did fail, becoming as bullish as it would have been bearish. The rally resumed and trended up through the noon hour’s exit.
It wouldn’t be especially interesting that the overnight sellers formed a reversal setup, except that the afternoon’s sellers did, too. Attacking the afternoon’s 2569.25 bias-up target to within 2 points was reversed down into the final hour. Still overlapping the afternoon’s 2550.50 bias-down signal — instead of already breaking under it — keeps alive the 2569.25 target. But exiting the bias environment under the noon hour’s low, and entering the final hour lower, means sellers gained traction and created a position of weakness.
Closing back within the 2548.00-2555.00 range avoided putting into play the next higher target at 2606.00. That’s another effort by sellers, although they failed to close under 2548.00. The afternoon’s position of weakness can still launch a test of the 2569.25 target, but the target’s test is now likelier to hold, assuming it is tested.
Details and other markets coverage are discussed in the post-market Wrap recording here.
Monitor overnight Globex trading in the chaRTroom here.
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))
Gapping up Sunday above 1.1485 resistance and the 1.1500 buy signal extended higher Monday to its highest levels in 2 weeks at 1.1550. A second consecutive higher close Tuesday would confirm.
Gold Feb Contract (GC, ETF: (GLD))
Friday’s dip back under 1284.00 had recovered through the close, which Sunday night exploited by trending back up. But Friday’s pre-open probe above 1300.00 was never retested, despite gapping up Monday to pierce Thursday’s 1295.50 high. Back under 1283.00 would signal a deeper pullback underway, but the 1319.50 target otherwise remains intact.
Silver Mar Contract (SI, ETF: (SLV))
Friday’s pre-open test of 15.95 had been retraced before Friday’s open, which held support intraday. An attempt to resume the rally Monday stopped short of Friday’s pre-open high before settling back into Friday’s range, still not reversing momentum down.
30-year Treasury Mar Contract (US, ETF: (TLT))
Closing under the 147-16 pullback limit needed to recover it Monday to resume the rally’s momentum. Its resistance held Sunday night’s bounce, which reacted back down Monday to test Friday’s 146-18 lows. Tuesday may be the last opportunity to resume the rally.
Crude Oil Feb Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Monday’s open was greeted probing further above the 47.00 buy signal, still needing a second consecutive higher close to confirm a rally can get underway despite having stopped 20 cents short of even touching the 43.35-44.15 pullback limit. Ending the day back under Friday’s highs did not confirm, but any initial strength Tuesday would still be credible for extending higher intraday.
Natural Gas Feb Contract (NG, ETF: (UNG, UNL))
Gapping down Sunday night didn’t extend down to fresh lows, which could be a last round of selling before at least trying to recover 4.15 where a bottom could begin forming.
Mid-day Update… Hasn’t slowed.
Fresh highs into, during, and out of the noon hour.
This morning’s bullish setups were all influential to absorbing the open’s attempts to reverse down. 
And the bullish setups were all influential to probing or trending higher this morning. And the bullish setups were all satisfied by noon.
But the rally kept on.
Now this afternoon’s 2562.25 bias-up signal has triggered. Its 2569.25 bias-up target has been attacked to within 2 points. It should be attacked to within 3 ticks at 2568.50 — perhaps up to 2570.00 — before a sell signal can be reliable.
Closing above the 2548.00-2555.00 range would next target 2606.00. Closing under the range would signal that upside momentum had lapsed. If the latter, then I would expect the close to be under Friday’s 2539.00 high to avoid confirming its breakout.
Look ahead: Economic Calendar – for Tue Jan 8, 2019
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: Tuesday’s calendar isn’t very busy, and its highlight might not be announced due to the government shutdown. That’s the JOLTS report, which can be a catalyst for a reaction following an influential Employment Situation report.
NFIB Small Business Optimism Index
6:00 AM ET
International Trade
8:30 AM ET
Redbook
8:55 AM ET
*JOLTS
10:00 AM ET
3-Yr Note Auction
1:00 PM ET
Consumer Credit
3:00 PM ET
Afternoon Bias
| MON afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 2561.75 | 2562.25 |
| …would target | 2568.75 | 2569.25 |
| Bias-down: under | 2550.00 | 2550.50 |
| …would target | 2540.25 | 2540.75 |
| Signal status: BIAS-UP | . | |
| BIAS VIDEOS… INTRO // EXAMPLE | ||
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.