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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))
Firming Sunday night extended higher through Monday morning to probe the decline’s 1.1790 bounce limit up to 1.1815. Any higher would next target 1.1840. But dipping into the afternoon returned to test 1.1790.
Gold Feb Contract (GC, ETF: (GLD))
Flat-to-higher Sunday night challenged 1251.20 resistance. Closing above 1255.50 would start to signal a bottom is forming. Otherwise, fresh lows would next target 1226.50.
Silver Mar Contract (SI, ETF: (SLV))
Sunday night’s firming wasn’t repeated intraday Monday, but neither was it rejected. Having fulfilled potential to 15.65, pullbacks must hold 15.75 to enable a bottom to form, which would be triggered back above 15.90 and 16.05.
30-year Treasury Dec Contract (US, ETF: (TLT))
Monday’s initial probe above the 153-10 buy signal was ongoing into the afternoon, and not winning, becoming more attracted back down to Friday’s close than to the next higher resistance at 154-08.
Crude Oil Jan Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Ranging flat-to-higher Sunday night above the 57.40 buy signal was not rejected intraday, and extended higher to probe 58.00. Closing back under 56.80 is still the nearest sell signal, while the nearest upside attraction would retest recent highs on the way to 61.05.
Natural Gas Jan Contract (NG, ETF: (UNG, UNL))
Gapping up from Thursday-Friday’s narrow overlapping intraday range didn’t extend higher, and can’t signal a recovery without first retesting the lower range from above.
Mid-day Update… Stepping it up.
Probing higher, testing resistance.
This morning’s reactions down from touching the 2660.50 objective ultimately included 2655.50. Close enough to the bias-up signal just 1 point lower to be in proximity of its break. If that’s what the market wanted, which it did not.
Rallying 4 points into the bias environment exit was extended through the noon hour to 2662.50. That elevated the 2661.25 to being decisive for still targeting 2667.25. Overlapping it at 1:20 invoked the grace period to allow extra time for triggering it. If that’s what the market wanted, which it did not.
So, the late no-bias environment has reacted down to 2659.75. Another point lower would signal momentum reversing down, limited for the next half hour down to this afternoon’s 2653.75 bias-down signal. Any lower after that could extend. If that’s what the market wants, which it does not if 2659.00 isn’t even broken.
Look ahead: Economic Calendar – for Tue Dec 12, 2017
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: Tuesday’s PPI is the day’s only high-profile report, but it is also reliable for influencing price action.
NFIB Small Business Optimism Index
6:00 AM ET
*PPI-FD
8:30 AM ET
Redbook
8:55 AM ET
4-Week Bill Auction
11:30 AM ET
*30-Yr Bond Auction
1:00 PM ET
Treasury Budget
2:00 PM ET
Afternoon Bias
| MON afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 2658.25 | 2661.25 |
| …would target | 2664.25 | 2667.25 |
| Bias-down: under | 2550.75 | 2653.75 |
| …would target | 2644.00 | 2647.00 |
| Signal status: LATE NO-BIAS, BIAS-UP | FAQ | |
| NEW! Flowcharts: Bias-UP // Bias-DN INTRO VIDEOS #1 and #2 |
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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.
Post-open Review… A bigger boom.
Pre-open implosion explodes higher post-open.
The knee-jerk reaction to the pre-open pipe bomb had plunged 5 points from 2657.25. Because of its catalyst, the plunge was likely to be retraced entirely.
Hovering pessimistically short of the plunge’s origin was potentially bullish from a contrarian perspective. And “unfinished business above” at 2660.50 was outstanding above.
All of which combined to absorb the retail crowd’s post-open knee-jerk reaction down. It was much shallower and only touched the 2654.50 bias-up signal. The opening 15 minutes of volatility had not resolved up, but a surge soon tested 2660.50 to within 1 tick. RSIs essentially diverged negatively on its retest. There is no other unfinished business above.
Exceeding 2660.50 through 10:15 would have renewed the bias-up signal. It held. This is still a bias-up environment, capable of extending higher. Back above 2659.75 would start to signal the rally extending, next targeting 2667.25. Back under 2656.50 would have room to test the 2654.50 bias-up signal as support during the bias-up environment, and much more room afterward.