members-only
Morning Bias
| WED morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2430.25 | 2428.00 |
| …would target | 2435.00 | 2433.00 |
| Bias-down: under | 2422.25 | 2420.25 |
| …would target | 2416.25 | 2414.00 |
| Signal status: BIAS-UP, BIAS-UP TARGET EXCEEDED | FAQ | |
| INTRO VIDEOS #1 and #2 | ||
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)
Tuesday’s open tested and held relevant support through a relevant timing window. That relevant level was the morning’s bias-down signal. Consequently, an offsetting test of the bias-up signal was put into play. And it was on the way to being tested when political headlines triggered a plunge.
Knee-jerk reactions to headlines are sponsored by weak hands. And their reactions are doomed to failure. Even if strong-handed opinion shares the same direction, they’ll step back so that weak hands can trap themselves, and then reverse the trend. Tuesday morning’s plunge didn’t require being recovered the same day, but that didn’t stop it.
The offsetting test of the morning’s bias-up signal was neutralized, too, being attacked to within 3 ticks. Momentum didn’t reverse back down, keeping the door open to fresh highs for the week — unless Tuesday’s low is broken through the close.
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 Sep Contract (EC, ETF: (FXE, UUP))
Not yet reversing down Monday after having neutralized the high’s outstanding gaps did make a probe of fresh highs likely before reversing down would be credible. Resistance was tested in the 1.1510-1.1525 area. Closing back under 1.1450 would signal momentum reversing down.
Gold Aug Contract (GC, ETF: (GLD))
Shallow overnight weakness hardly attacked Monday’s 1204.80 support before recovering to probe above Monday’s high to 1217.00. A more reliable bottom would retest the overnight lows, but closing higher Wednesday would be credible for extending.
Silver Sep Contract (SI, ETF: (SLV))
Overnight weakness was reversed Tuesday to probe Monday’s close, which had recovered 15.55-15.60 to being signaling the decline has ended.
30-year Treasury Sep Contract (US, ETF: (TLT))
Tuesday’s narrow ranging didn’t extend the decline, but still doesn’t qualify as the “warning shot across the bow” at sellers which this pattern tends to form at the end of its trend and just prior to reversing.
Crude Oil Aug Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Ranging narrowly sideways Tuesday would have confirmed that Monday’s dip didn’t complete the bottoming pattern, which should still test the low’s consolidation to at least 43.40 if not also slightly lower. Firming back above 44.90 instead did fill a gap, but does undermine the near-term test of the lows.
Natural Gas Aug Contract (NG, ETF: (UNG, UNL))
Monday’s gap up was within Friday’s range so the gap back down to Friday’s close does not require being filled. Gapping up this morning above the 2.95-2.97 buy signal was above a prior low, so retesting “lower prior highs” may be avoided. Closing above 3.05 would suggest the rally is simply extending.
Mid-day Update… Blind-sided.
Politics derails the morning’s recovery.
Testing and holding this morning’s 2421.50 bias-down signal had put into play an offsetting test of the 2428.00 bias-up signal. The upside objective was attacked to within 2 points, 
and then retested just as headlines triggered a 16-point plunge to 2410.25.
Exiting the bias environment beyond its bias target would have invalidated whatever may have been put into play by holding that bias signal. So, not recovering back above the 2415.50 bias-down target through 11:30-noon would have invalidated the 2428.00 objective, which was put into play by holding 2421.50 through 10:15.
In fact, the noon hour was attacking 2421.00. So, a test of 2428.00 has become “unfinished business above.” It need not be met today — back under 2416.75 would start to signal a retest of the lows underway, as required by its oversold RSIs.
This afternoon’s 2414.75-2422.25 bias signals weren’t touched or triggered. Either should define the no-bias environment if tested. Probing beyond either during the no-bias environment would require being retraced.
If the upside attraction isn’t re-established already when the bias environment begins lapsing, then another dip would be very likely. Just retesting today’s low and filling the gap back to Friday’s Thursday’s 2408.00 close just below it could launch a recovery. Not holding their test would be likely to probe fresh lows down to 2499.00 and 2493.00.
Look ahead: Economic Calendar – for Wed Jul 12, 2017
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: The first day of Fed chair Yellen’s two-day semi-annual congressional testimony begins in the House on Wednesday. The afternoon’s Beige Book and Fed speaker could influence price action, too.
MBA Mortgage Applications
7:00 AM ET
Atlanta Fed Business Inflation Expectations
10:00 AM ET
*Janet Yellen Testifies
10:00 AM ET
EIA Petroleum Status Report
10:30 AM ET
10-Yr Note Auction
1:00 PM ET
*Beige Book
2:00 PM ET
*Esther George Speaks
2:15 PM ET