Bias-parameters
Afternoon bias
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| WED afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 1351 | 1351’00 |
| …would target | 1357 | 1357’00 |
| Bias-down: under | 1342.75 | 1342’75 |
| …would target | 1335 | 1335’00 |
| Signal status: testing Bias-down | FAQ | |
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Bias-down target met… and others, too.
[pay]Plummeting prices ahead of the cash session open and through it, falling eventually to ESm 1340’00. My two ultimate targets for this downleg have been 1340’00-1342’00, and then 1335’00. A bounce back up to this morning’s 1346’00 bias-down target just produced a retest of the first target, where MACD & RSI have improved sufficiently to predict that this morning’s low is now forming.
The timing is very interesting because of this afternoon’s looming Beige Book at 2:00. A substantial bottom could form if a test of the 1335’00 target can be accomplished somewhere in the process of anticipation or reaction. Perhaps a bounce up to 1349’00-1350’00 where a pessimistic knee-jerk reaction could create a thoroughly petrified environment – while actually holding a retest of this morning’s low and fulfilling my lower target. Or, extending this downleg to my lower target into and/or out of the news.
Regardless of their order or other permutations, the market does have a marvelous opportunity to end this downleg that was first signaled at May 19’s highs. The problem, as with all steep drops into bottoms, is their resemblance to downlegs that are extending into “crashes.” The opportunity to bottom has not yet been accepted by the market, and might not be.
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Morning bias
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| WED morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 1360.75 | 1361’00 |
| …would target | 1367.75 | 1368’00 |
| Bias-down: under | 1354.50 | 1354’75 |
| …would target | 1345.75 | 1346’00 |
| Signal status: Bias-down target met | FAQ | |
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You did say, “Bias-up,” right?
[pay]Yep. And yet S&Ps have dropped 13 points from the ESm 1367’25 high down to 1354’25. The resolution has been expected to be down, and nothing is changing that. But the interim steep sell-off was not on the menu. MACD & RSI did improve into the low and currently signal a recovery above 1357’25, confirmed above 1358’50 and targeting at least 1361’00-1362’00.
I would keep a tight stop if long – such as 1356’00 – and consider shorting under 1354’75 for a dive targeting 1342’25.
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Bias-up for pullbacks.
[pay]At 1:30 the bias-up target was still being tested. Now the signal, the target. This is a bias-up environment. Dips are likely to recover and breaks of resistance are likely to extend higher. Neither needs to happen at all since the target was met and held. But at least we do know that a sell-off is unlikely for at least another hour.
I am expecting a pullback to appear before a break of resistance, and possibly no break of resistance at all. In fact, the last of yesterday afternoon’s drop was just retraced back to its ESm 1368’00 origin – natural resistance. I wouldn’t be surprised if it wasn’t exceeded, but a pullback to 1361’00 that recovers back above 1362’75 will likely attack it again. Otherwise, 1359’00 would be the next likely pullback target.
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