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Market Wrap (recording & summary)
Monday’s close had fallen short of signaling the next higher attractions in-play. An overnight probe of fresh highs up up to 2746.00 had ended before reinstating Monday afternoon’s upside momentum. Finally, a deeper pullback to 2730.00 was recovered back above 2738.00 to reinstate upside momentum. The higher attractions were quickly filled up to Friday’s 2751.25 opening gap.
The balance of the session essentially ranged sideways. Up a little to 2753.25, down a little to 2738.00 (where oversold RSIs will require an eventual retest). Then firm back into the range above 2746.00 and await the overnight election resul… WHOA WAIT A MINUTE…
The last 15 minutes suddenly surged 16-17 points through the close up to 2761.00. We had just finished the Market Wrap’s discussion of potential up to 2758.00. Let’s adjust that up to 2764.00. Not that 2758.00 requires a retest — it isn’t a “new Globex trend extreme” — but there’s still room for noise.
Perhaps anxiousness ahead of Tuesday night’s election results kept the session ranging choppily sideways. Perhaps last-minute optimism (what could go wrong?) accounts for the late surge. We’ll know more overnight, and I’ll be checking into the chaRTroom to compare market sentiment and high-profile race results for any predictive values.
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 Dec Contract (EC, ETF: (FXE, UUP))
Gapping up slightly extended only so far as to fill the gap back up to Friday’s 1.1475 opening gap. Neutralizing its attraction above allows almost any initial weakness Wednesday to be credible for extending down, signaled under 1.1400.
Gold Dec Contract (GC, ETF: (GLD))
Tuesday’s slightly lower low started chipping away at 1228.00 support, after the “ineffectual optimism” of having hovered above it Monday.
Silver Dec Contract (SI, ETF: (SLV))
Monday’s consolidation had delayed extending Friday’s break under the 14.70 sell signal, but Tuesday’s break under 14.50 compensated for the delay. A second consecutive lower close Wednesday would confirm.
30-year Treasury Dec Contract (US, ETF: (TLT))
Monday’s narrow flat-to-higher ranging was followed by Tuesday’s narrow flat-to-lower ranging, all contained within Friday’s range to suggest that the first trending attempt will be false. Regardless, Friday’s break isn’t rejected, greeting Wednesday’s 30-year auction not from a position of strength, but still capable of absorbing an initially negative knee-jerk reaction down.
Crude Oil Dec Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Not maintaining 63.22 overnight had no excuse to further delay resuming the decline, and Tuesday morning plunged to 61.31. A second consecutive lower close on Wednesday would confirm that at least an eventual third lower close is required.
Natural Gas Nov Contract (NG, ETF: (UNG, UNL))
Tuesday’s narrow flat-to-higher ranging up to 3.58 did not even bother trying to reject Monday’s surge, which doesn’t necessarily help it to extend higher immediately, but does help to recover from a pullback to 3.42.
Mid-day Update… Restrained optimism.
Hovering at highs.
The open’s surge stopped immediately upon filling the gap back to Friday’s 2751.25 gap up. Just touching a filled gap isn’t ever likely to launch a reversal. And that undermined its reaction down to 2742.00 from extending. Which it didn’t.
The noon hour’s probe up to 2753.25 satisfies the room for noise above 2751.25, and touching it did react down. But that hasn’t launched a reversal, either. Not for lack of trying — the afternoon’s 2750.50 bias-up signal held its test to trigger late no-bias.
Exiting the bias environment back above 2752.50 would start to signal the rally is extending. This afternoon’s 2757.50 bias-up target would still be a likely attraction, and any higher would be difficult to reverse down today. Otherwise, back under 2748.00 and 2743.00 would signal and confirm a reversal is underway already.
Look ahead: Economic Calendar – for Wed Nov 7, 2018
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: Wednesday’s 30-year auction tends to inhibit volatility until the results are posted. No other report is either high-profile or influential to price action.
MBA Mortgage Applications
7:00 AM ET
EIA Petroleum Status Report
10:30 AM ET
*30-Yr Bond Auction
1:00 PM ET
Consumer Credit
3:00 PM ET
Afternoon Bias
| TUE afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 2751.00 | 2750.50 |
| …would target | 2757.75 | 2757.25 |
| Bias-down: under | 2741.50 | 2740.75 |
| …would target | 2736.25 | 2735.50 |
| Signal status: LATE NO-BIAS, TESTED BIAS-UP SIGNAL | . | |
| NEW: 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.