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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 Sep Contract (EC, ETF: (FXE, UUP))
Friday’s spike up to 1.1989 on the Employment Situation report fulfilled the 61.8% retracement of the drop from Tuesday’s high to Thursday morning’s low. It was retraced entirely and then reversed down much closer to Thursday’s low, near the 1.1854 pullback limit that keeps the door open to rallying out of the weekend.
Gold Dec Contract (GC, ETF: (GLD))
The favorable reaction to Friday’s Employment Situation report quickly probed above Tuesday night’s 1332.00 high whose near-term retest had been signaled Thursday. Its reaction down to 1321.00 held as support, avoiding a close under 1318.50 that would signal momentum reversing down.
Silver Dec Contract (SI, ETF: (SLV))
Friday’s open spiked up to pierce Tuesday night’s 17.75 high. Its reaction down was recovered and extended slightly to suggest the 17.90 target remains in-play.
30-year Treasury Dec Contract (US, ETF: (TLT))
Slightly lower lows fulfilled the 155-04 pullback objective down to 154-30. Holding 155-04 through the close allows a near0term retest of Tuesday night’s 156-28 high.
Crude Oil Oct Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Thursday’s recovery from having attacked the 45.50 target overnight was not extended Friday, which undermines the recovery attempt’s sponsorship. But its initial dip did hold. Closing under 46.50 is still necessary to confirm the decline’s momentum remains intact.
Natural Gas Oct Contract (NG, ETF: (UNG, UNL))
Flat-to-lower overnight resolved soon after Friday’s open in a surge through Thursday’s 3.04 high to fresh highs attacking 3.10. The second consecutive higher close confirms a breakout, suggesting the bottoming pattern we’ve been monitoring is now resolving.
Mid-day Update… In the sweet spot.
Attacking July’s pivotal high.
This morning’s 2477.25 bias-up target held its tests through 10:15 to avoid renewing the bias-up signal. Prematurely probing 1 point above it reacted back down to 2474.50 as the bias environment began lapsing. And then it recovered.
Fresh highs coming out of the noon hour have attacked 2480.00 to within 1 tick. That’s essentially July’s high, which is the high prior to August’s actual high — the “pivotal high.” And there’s usually no bearish reason to revisit the pivotal high after having probed its interim low. Meaning, August’s actual high would likely be retested, too.
First things, first. An afternoon downleg can’t be discounted. This afternoon’s bias-up did trigger and it does target fresh session highs. But nothing prevents a downdraft. Back under 2476.75 would start to signal the weekend will be greeted in decline. Otherwise, the near-term trend remains up, no matter how shallowly.
Look ahead: Economic Calendar – for Mon Sep 4, 2017
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: U.S. markets are closed for the Labor Day holiday. Globex opens Sunday night as usual, and trades through Monday’s noon hour, then re-opens as usual Monday evening.
Globex close
1:00 PM ET
Globex open
6:00 PM ET
Afternoon Bias
| FRI afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 2478.25 | 2477.25 |
| …would target | 2483.50 | 2482.75 |
| Bias-down: under | 2471.50 | 2470.75 |
| …would target | 2465.00 | 2464.00 |
| Signal status: BIAS-UP | FAQ | |
| INTRO VIDEOS #1 and #2 | ||
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… Granted.
News fulfills recent optimism, but no more.
Pre-open rallying had already fulfilled the next higher objective at 2477.00. The knee-jerk reaction to Payrolls tested this morning’s 2477.25 bias-up target. But not much more. And not for long.
Post-open action also tested 2477.25, and that test held, too. Reacting down came within 3 ticks of touching the 2472.25 bias-up signal. Never mind, its recovery was maintained through 10:15 to trigger bias-up.
So, this is a bias-up environment, whose target has been met already. Its retest isn’t required, although it’s being attacked now to within 2-3 ticks. And its resistance isn’t required to hold, although it often does.
Maintaining the gap up without also also extending higher through the open isn’t necessarily bullish. And less so when its reaction overlaps the prior session’s high. If still hovering at the highs through the morning, then watch the bias environment exit at 11:30 for indications of breaking either way — which could trend well into the afternoon.