Bias-parameters
Afternoon bias
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| WED afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 1280.50 | 1280’25 |
| …would target | 1285 | 1285’00 |
| Bias-down: under | 1275 | 1275’00 |
| …would target | 1268.25 | 1268’00 |
| Signal status: No-bias? | FAQ | |
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Bias-down target met.
[pay]The ESu 1277’50 bias-down target was probed by more than 1 point before bouncing back above prior lows. The bounce is now attacking the 1280’00 area, whose test should send S&Ps back down to the lows and lower.
Today’s second consecutive gap down is a sign that sellers are trying to take control. Extending lower without filling the gap is a sign that they’re succeeding. Within the context of being a reaction to Monday’s doomed surge to new highs, there could be substantial selling pressure working its way into the system.
The slide has already done substantial damage to the chart. Either sellers have been expended and a corrective bounce will begin, or else this afternoon will be very vulnerable to extending lower at an accelerated pace. Above 1285’00 suggests a recovery attempt, and under 1276’00 suggests further decline.
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Morning bias
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| WED morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 1297.25 | 1297’00 |
| …would target | 1305.50 | 1305’50 |
| Bias-down: under | 1288 | 1288’00 |
| …would target | 1277.25 | 1277’50 |
| Signal status: Bias-down | FAQ | |
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No-bias.
[pay]The noon hour’s low at ESu 1297’50 was tested at the 1:20 timing window, a couple of points above the afternoon’s 1295’25 bias-down signal which wasn’t touched until 1:30. The no-bias environment is unlikely to attempt trending, and trending attempted is likely to be retraced.
Despite the open’s gap down, and spending the entire session so far in negative territory, this morning’s low hasn’t been broken. If there isn’t a recovery either, then today’s session would be classified as “ineffectual pessimism.” The setup tends to produce a bounce of some sort the following day.
Markets do try to avoid the “ineffectual” classification, so the day’s last 90 minutes become increasingly vulnerable to trending one direction or the other.
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Afternoon bias
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| TUE afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 1303.25 | 1303’25 |
| …would target | 1308.75 | 1308’75 |
| Bias-down: under | 1295.25 | 1295’25 |
| …would target | 1287.50 | 1287’50 |
| Signal status: No-bias | FAQ | |
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