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The First Trade & Pre-open Tour Recording… Not rejecting the late plunge.
Proper context can start the day with a solid win and make all the difference.
DAILY SCHEDULE
First, watch the pre-open Tour recording HERE <<==
Then, meet in the chaRTroom here by 9:15 ET for updates and Q&A
Through the prior close…
Thursday’s gap down to 2909.00 had ultimately extended to exit the bias window at fresh session lows down to 2904.00. The afternoon’s 2911.00 bias-up signal triggered, but extending to its 2918.00 was prevented by an afternoon headline that triggered a plunge to 2895.50, closing at 2902.00. Closing under 2909.00 failed to confirm higher trend objectives that were signaled Wednesday, and afternoon sellers gained traction for their effort. But new unfinished business above at 2918.00 suggests the dip will be recovered.
Overnight action’s new info…
Bouncing through midnight touched the morning’s 2904.00 low, and greeted Europe’s opens unchanged at yesterday’s 2902.00 close. Collapsing 5 points was retraced back up to 2902.00, but only to 2902.00, and has since extended to attack yesterday’s 2895.50 low to within 1 tick.
If, then… (notes to accompany the Tour recording)
Thinning volume ahead of the 3-day holiday weekend has two contradictory consequences. While the market is robbed of natural volatility, it is also vulnerable to knee-jerk reactions triggered by artificial catalysts. Yesterday morning’s range around its gap down exemplifies the non-volatility, and the afternoon’s headline plunge reflects the vulnerability. But not all headlines get a reaction, and even while overnight weakness is attributed to continued overnight weakness among emerging markets, yesterday’s low still holds. That doesn’t prevent extending down further this morning, as already suggested by yesterday afternoon’s traction, with unfinished business below at 2892.25.
First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 under 2897.50 would be likely to trigger the 2898.25 bias-down signal at 10:15. Exiting the open above 2903.00 would be unlikely to trigger bias-down.
Morning Bias
| FRI morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2907.00 | 2907.50 |
| …would target | 2913.50 | 2914.00 |
| Bias-down: under | 2897.50 | 2898.25 |
| …would target | 2891.75 | 2892.25 |
| Signal status: NO-BIAS. TESTED BIAS-UP SIGNAL, ALREADY TESTED BIAS-DOWN SIGNAL | . | |
| NEW: BIAS VIDEOS… INTRO // EXAMPLE | ||
1. At 10:15, 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 10:15 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 10:15 would invoke a grace period through 10:30 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 10:30 after invoking the grace period would trigger “noN-bias,” with no bias influence.
Market Wrap (recording & summary)
The recent tradition of morning trending into afternoon ranging was reversed Thursday. Gapping down ranged choppily sideways, and an afternoon retest of the morning’s high reacted down sharply.
Granted, the afternoon’s plunge was a headline reaction. And the morning’s bias window exit was probing fresh session lows. But sellers gained traction for their efforts, exiting the afternoon bias window and entering the final hour under their prior timing window’s lows.
Nevertheless, “unfinished business” was left outstanding above at the afternoon’s 2818.00 bias-up target. Which would be an attraction, especially if Friday’s open is gapping up above Thursday afternoon’s 2913.00 high, which is definitely possible if Friday isn’t extending Thursday’s drop to unfinished business below at 2892.25.
Details and other markets coverage are discussed in the post-market Wrap recording here.
Monitor overnight Globex trading in the chaRTroom here.
Mid-day Update… Risks of an illiquid environment.
New tariffs news triggers plunge.
Today’s signals have probably been impacted by volume contracting ahead of the 3-day holiday weekend. This morning barely triggered noN-bias, and used the aimless environment to range choppily sideways.
Now this afternoon’s cleanly triggered 2911.00 bias-up signal has stalled under 2913.00, and then collapsed to 2899.00. The stalling may have been related directly to volume, but the collapse is indirectly related — the low-volume environment has magnified the reaction to a China trade war tariff headline.
It’s too late to exit the bias window under its 2895.50 bias-down target, so the 2918.00 bias-up target becomes “unfinished business” above. Back above 2903.00 (being tested now) could start that recovery. But back under 2900.00 would more likely extend the decline.
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 Sep Contract (EC, ETF: (FXE, UUP))
Thursday quickly dipped to retest Wednesday’s low, which itself had touched the 1.1675 sell signal. Its break would leave no unfinished business above, and initially target 1.1445.
Gold Dec Contract (GC, ETF: (GLD))
Breaking through the 1207.50 sell signal Thursday only attacked 1202.00, still targeting 1191.50 and probably 1172.50.
Silver Dec Contract (SI, ETF: (SLV))
[Rolling coverage forward to Dec, which trades at a 13-cent premium to Sep]… Thursday’s open was greeted trending down from the 14.82 sell signal that was tested throughout Wednesday.
30-year Treasury Sep Contract (US, ETF: (TLT))
Wednesday’s failure to confirm Tuesday’s break under 144-19 was extended by bouncing further Thursday. Last-minute sentiment ahead of next Friday’s Employment Situation report is likely having an effect, but the news is not being greeted from a position of weakness that would have been reliable to react negatively.
Crude Oil Oct Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
The rally extended to within a nickel of its 70.55 minimum corrective bounce objective. Reversing down wouldn’t be credible until the target is fully tested, and the corrective bounce could meanwhile extend higher. But closing under 69.50 would suggest that a bounce peak is forming.
Natural Gas Oct Contract (NG, ETF: (UNG, UNL))
Wednesday’s bounce from retesting the decline’s 2.82 target failed again to close above 2.87 and reverse momentum up. It was being tested at the close, but the decline remains vulnerable to extending.