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Market Wrap (recording & summary)
Sunday night’s rally up to 2721.50 wasn’t able to escape the orbit of 2708.00-2709.00. Its room for noise at 2705.50-2712.00 was re-entered soon after Monday’s open, and contained the balance of the session. But that only delayed Sunday night’s intent, and Monday night’s rally compensated for the delay.
Bias-up parameters had been far exceeded overnight, but Tuesday’s open was greeted at the 2727.75 renewed bias-up target. While also testing “higher prior lows” from the Tue-Wed consolidation at last week’s highs. After having trended relentlessly overnight. All of which was entirely vulnerable to losing the rally’s sponsorship. But reinforcements arrived immediately to extend the rally.
The ultimate objective at 2751.00 was attacked to within 3 points during Tuesday afternoon’s bias environment. Its shallow correction to 2741.50 reacted back up into the close. Wednesday’s peak liquidity ahead of the three-day holiday weekend offers a template that both fulfills rejects the higher objective before entering the noon hour. Maintaining higher highs into the afternoon would be much more difficult to reverse down.
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 Mar Contract (EC, ETF: (FXE, UUP))
Monday’s fresh lows filled the three-week old low close’s gap and probed its intraday lows. After probing even lower overnight, closing back above 1.1333 would be credible for at least starting to form a bottom. Probing it Tuesday attacked 1.1375 whose recovery would signal the trend had reversed back up.
Gold Feb Contract (GC, ETF: (GLD))
Monday’s dip back down to Thursday’s prior lows had held to keep the door open for triggering the 1317.00 buy signal. It was tested through Tuesday’s open, but held for a reaction that tested Monday’s 1311.00 close and at least neutralized its reaction below.
Silver Mar Contract (SI, ETF: (SLV))
Monday’s retest of Thursday’s prior lows had kept open the door for another attempt at triggering the 15.80 buy signal. Already testing the buy signal before Tuesday’s open, its post-open reaction only dipped to fill the gap back down to Monday’s 15.65 close.
30-year Treasury Mar Contract (US, ETF: (TLT))
The 146-10/146-16 pullback limit’s test on Monday gave way overnight to probe fresh pullback lows down to 146-00. The gap down’s reaction blipped-up to 146-16, only to revisit the open’s low, and lower to 145-26. A recovery probably can’t tolerate much further delay beyond Wednesday morning.
Crude Oil Mar Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Firming into Tuesday’s open had probed the 53.20 buy signal and tested 54.00 to suggest the two prior sessions’ lows were accumulative, and that the rally is resuming. Closing above 53.20 would greet Wednesday’s EIA from a position of strength.
Natural Gas Mar Contract (NG, ETF: (UNG, UNL))
Monday’s surge back up to 2.75 resistance had corrected overnight to at least attack Friday’s 2.60 “lower prior highs” before attempting to rally again Tuesday morning. Just closing above 2.70 would start to signal a bottom is forming.
Mid-day Update… The three-day weekend effect.
A seasonal timing window may be rushing to fulfill upside.
The open’s rally peaked at 2735.50, but none of my measurements justified that being the rally’s end. Room for a pullback down to 2730.00 was fully exploited before price began firming. Firming, and then surging to 2742.00 before the bias environment began lapsing.
Flat-to-higher ranging through the noon hour attacked 2745.00, fulfilling the rally’s next higher target at 2743.50. Reactions down held 2739.00, and now the afternoon’s bias-up has triggered late. The rally’s next higher target at 2751.00 — which is also this afternoon’s bias-up target — is in-play.
RSIs are now overbought at the current high attacking 2747.00 to require that any immediate dip be recovered. Back under 2742.00 could be difficult to recover.
Wednesday is the wek’s most liquid, and the most predictive Wednesdays precede expirations and 3-day weekends. Counter-trend sponsorship ahead of 3-day weekends is difficult to generate after Wednesday. Fulfilling the 2751.00 target without putting into play a higher objective could be difficult to reverse back down.
Look ahead: Economic Calendar – for Wed Feb 13, 2019
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: Several Fed speakers appear sporadically throughout Wednesday. Only one high-profile econ report is scheduled. Its reaction should duplicate any reaction to either the pre-open report or Fed speaker.
MBA Mortgage Applications
7:00 AM ET
Raphael Bostic Speaks
7:15 AM ET
*CPI
8:30 AM ET
*Loretta Mester Speaks
8:50 AM ET
Atlanta Fed Business Inflation Expectations
10:00 AM ET
EIA Petroleum Status Report
10:30 AM ET
*Patrick Harker Speaks
12:00 PM ET
Treasury Budget
2:00 PM ET
Afternoon Bias
| TUE afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 2744.25 | 2743.50 |
| …would target | 2751.75 | 2751.00 |
| Bias-down: under | 2735.50 | 2735.00 |
| …would target | 2728.25 | 2727.75 |
| Signal status: LATE BIAS-UP | . | |
| BIAS VIDEOS… INTRO // EXAMPLE | ||
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.