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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 Jun Contract (EC, ETF: (FXE, UUP))
Gapping up above Monday’s 1.0640 high initially extended higher to test 1.0665 but dipping back under Monday’s highs. The “ineffectual pessimism” does require resolving down immediately to confirm fresh lows at 1.0550 remain in-play.
Gold Jun Contract (GC, ETF: (GLD))
Gapping up Tuesday above Monday’s 1259.00 high extended to probe above Monday morning’s 1273.00 high to test 1276.00. The pattern doesn’t require any higher high, but the rally remains intact so long as 1272.00 holds as support.
Silver May Contract (SI, ETF: (SLV))
Rallying through Tuesday morning tested the 18.30 pullback limit that had broken sharply lower Friday afternoon. Pullbacks must now hold 18.06 to maintain the recovery potential.
30-year Treasury Jun Contract (US, ETF: (TLT))
Gapping up slightly Tuesday morning amid more geopolitical anxiousness extended sharply through the morning to test Friday’s 153-04 high. Back under 152-04 would suggest the topping pattern remains intact.
Crude Oil May Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Initially dipping Tuesday morning to 52.70, OPEC headlilnes triggered a spike up during the noon hour to a fresh high attacking the 53.55 buy signal to within 20 cents. The pullback limit is now 52.00.
Natural Gas May Contract (NG, ETF: (UNG, UNL))
Gapping down slightly Tuesday extended to within 1 cent of the 3.13 sell signal. Its break wouldn’t be very reliable without first bouncing, potentially back above 3.19 to 3.27.
Mid-day Update… Potato, potahto.
Much of morning’s drop already recovered. Or corrected.
The timing of this morning’s downlegs resemble yesterday, still coinciding with negative headlines. Today’s aren’t recovering before resolving down, so recovering them would be done by one comprehensive upleg — if done, at all. The minimum objective would be 2349.00.
2349.00 is pretty far removed from the morning’s 2333.25 low. The bias environment exit was just 3 points short of the 2343.50 level whose recovery could have undermined sellers already. Too late for that, now 2349.00 is required.
So, undermining sellers now requires a more substantial move. Considering the time limit, that move will need to be steep. In fact, the noon hour just produced a 7 points surge to 2345.00. And it has added another 6 ticks. The 2349.00 objective is no longer so much further away.
This being the noon hour, this might be only a temporary corrective bounce. Triggering the 2343.00 bias-up signal would help to undermine sellers. But entering or exiting the bias environment above its 2349.50 bias-up target would be optimal.
Look ahead: Economic Calendar – for Wed Apr 12, 2017
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: No influential reports are due Wednesday, although the Atlanta Fed expectations is high-profile.
MBA Mortgage Applications
7:00 AM ET
Import and Export Prices
8:30 AM ET
Atlanta Fed Business Inflation Expectations
10:00 AM ET
EIA Petroleum Status Report
10:30 AM ET
10-Yr Note Auction
1:00 PM ET
Treasury Budget
2:00 PM ET
Afternoon Bias
| TUE afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 2346.00 | 2343.00 |
| …would target | 2352.25 | 2349.50 |
| Bias-down: under | 2337.75 | 2335.00 |
| …would target | 2331.50 | 2328.50 |
| Signal status: BIAS-UP, BIAS-UP TARGET MET | 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… Artificial gets real.
Strong-handed buyers step aside.
The open quickly pierced yesterday’s 2347.50 low by several ticks and then bounced up to 2351.75. But only briefly, as a deeper drop tested 2341.00.
Its reaction up attacked yesterday’s lows as resistance, but resolved down again. This time, much deeper, down to 2334.75.
Yesterday’s opening setup, afternoon bounce and positive close all indicate that strong-handed sellers are marginalized. And yet another downleg is developing in reaction to headlines. That’s the behavior of impatient weak-handed sellers.
The near-term effect on price can be indistinguishable. Down is down. How far down and whether it stays down makes the difference.
Exiting the bias environment back above its 2343.50 bias-down target would confirm that strong-handed sellers remain marginalized. It might also start to suggest that strong-handed buyers are attracted. Otherwise, not yet rejecting these fresh lows would suggest much lower levels are in-play, essentially 2327.00, 2321.00 and potentially 2311.00.