Bias-parameters
Still fighting the bias-down.
[pay]Another test of the ESm 1364’00 area failed to extend higher, so the LEI news wasn’t greeted from high enough to absorb selling. As a consequence, S&Ps have probed a new low down to 1359’25, within 1 point of the bias-down target. Also as a consequence, a recovery above 1361’50 would now be appropriate for aggressive trader to consider buying, with a stop under 1360’00. Otherwise, back above 1364’00 through 10:15 should turn exponential to at least attack overnight highs.[/pay]
Fighting the bias-down signal.
[pay]The pullback’s ESm 1361’50 target was met, and exceeded by at least 1 point in an emotional extreme that required a retest. The retest came in reaction to Jobless Claims data an hour ago and has since held. The news spigot is now off until LEI at the top of the hour.
I would like to see the 1365’00 bias-down signal recovered by then, helping a favorable reaction to LEI that gets S&Ps back up to overnight highs. Although this overnight high doesn’t require a retest, the gap back to yesterday’s cash session close should suffice to magnetically attract price higher. But I don’t want to enter long under 1364’00 or hold long under 1361’50 while waiting for bigger buyers to join in.[/pay]
Morning bias
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| THU morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 1369 | 1370’50 |
| …would target | 1376 | 1377’50 |
| Bias-down: under | 1363.50 | 1365’00 |
| …would target | 1357 | 1358’50 |
| Signal status: No-bias, held test of bias-down | FAQ | |
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Afternoon bias
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| WED afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 1357.75 | 1358’25 |
| …would target | 1361.50 | 1363’00 |
| Bias-down: under | 1351 | 1352’50 |
| …would target | 1345.75 | 1347’25 |
| Signal status: No-bias, tested bias-up signal, Beige Book due @ 2:00 | FAQ | |
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Bias-up target retested.
[pay]The ESm 1347’00 pullback limit launched a retest of the 1351’00 bias-up target by more than a 5-point margin, instead of breaking lower to trigger a sell signal. Since pullbacks originally needed to hold 1350’00 to maintain the rally’s momentum – and since that pullback limit failed to hold – this higher high is likely only a retest of the bias-up target. Back under 1352’00 would qualify as a sell signal.
The Fed’s Beige Book tends to shake things up, quite a bit, and it is due for release at 2:00pm ET today. If today’s rally is stretching buyers thinly, then you can imagine what sort of havoc the report might incite. But havoc cuts both ways. Without a sell signal, the bearish scenario would be limited to a temporary pullback, assuming the report didn’t trigger even more and steeper gains.[/pay]