The First Trade

Proper context can start the day with a solid win and make all the difference.

NEW DAILY SCHEDULE
First, watch the pre-open Tour recording HERE <<==
Then, meet in the chaRTroom here by 9:15 ET for updates and Q&A

Through the prior close…
Tuesday broke two streaks. The first was not gapping up following three consecutive gaps up. But after holding a test of the 2321.50 bias-down signal down to 2319.75, Tuesday adhered religiously to this leg’s daily tradition of extending to new highs into the afternoon. Objectives left outstanding from Monday and created Tuesday morning were all neutralized along the way up to the afternoon bias environment’s 2335.25 peak. Surging into the fourth consecutive higher attacked 2338.00. Tuesday did break one other streak by leaving no “unfinished business above.”

Overnight action’s new info…
A quick pullback tested Tuesday afternoon’s high as support down to 2334.25. Consolidating narrowly until a midnight surge probed new high at 2340.00. There was no complexity to the surge before it reacted back down under Tuesday’s highs to within 2 ticks of the overnight low.

If, then…
Tuesday was the first session of this four-day rally to end in a short-squeeze. That’s not a sell signal itself, but it does reflect a new degree of impatient buying, which suggests that optimism is getting excessive. The overnight surge did not qualify for requiring an intraday retest, but it is a new trend high, so exiting the open under the overnight low could launch a pullback. Temporary backing-and-filling has room down to 2327.00 and 2324.50 before suggesting something more substantial underway. Avoiding a pullback this morning and extending higher would next target 2343.00-2344.00, but remain vulnerable to the indications that momentum is weakening. Regardless, like yesterday, be careful not to rely on early price action persisting — a lot is happening before 10:15, which I describe in today’s Tour.

First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 above 2337.75 would be likely to trigger the 2336.50 bias-up signal at 10:15. Exiting the open under 2334.00 would be unlikely to trigger bias-up.

Proper context can start the day with a solid win and make all the difference.

NEW DAILY SCHEDULE
First, watch the pre-open Tour recording HERE <<==
Then, meet in the chaRTroom here by 9:15 ET for updates and Q&A

Through the prior close…
For a third consecutive session, Monday gapped up and extended higher into the afternoon, to a new trend high close. Retesting Friday’s overbought RSI and bias-up target were neutralized along the way. A new (trend) high close neutralized a couple of requirements in the process. Room for noise beginning at 2327.00 was satisfied, and also held through the close. But another overbought RSI and bias-up target were left outstanding at 2329.00 and 2331.50, respectively.

Overnight action’s new info…
Monday afternoon’s 2327.75 pullback limit had been violated and a sell signal under 2525.75 was being tested into the close. Gradually drifting lower attacked the signal’s 2322.75 objective to within 2 ticks ahead of Europe’s opens. Narrow ranging from there has been resisted by 2325.75.

If, then…
Three consecutive sessions may be this leg’s streak for gapping up, as none is currently indicated by overnight action. So, is trending higher intraday also ending its streak? Possibly, if not probably — closing yesterday under 2327.00 after probing above it does suggest upside momentum is waning. But probing higher intraday remains possible, if not probable — the overnight pullback still has some room below to 2321.50, while remaining in the orbit of yesterday’s 2329.00 and 2331.50 “unfinished business above.” Even a deeper pullback could test “lower prior highs” at 2313.00 and be attracted back up to Monday’s 2319.00 opening print. Fed Chair Yellen’s Senate testimony this morning will likely be inhibiting, and then probably a catalyst, to send price in both directions. Regardless of the vulnerability otherwise, we can’t yet discount another new high close today.

First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 above 2322.75 would be unlikely to trigger the 2321.50 bias-down signal at 10:15. Exiting the open under 23219.00 would be likely to trigger bias-down. Exiting the open under 2327.75 would be unlikely to trigger the 2330.75 bias-up signal.

Proper context can start the day with a solid win and make all the difference.

NEW DAILY SCHEDULE
First, watch the pre-open Tour recording HERE <<==
Then, meet in the chaRTroom here by 9:15 ET for updates and Q&A

Through the prior close…
Friday’s rally trended up into the afternoon’s bias environment to 2315.75. The balance of the afternoon back-and-filled down to 2312.00, hanging on to confirm Thursday’s breakout. The requirement to retest overbought RSIs at 2315.75 was left outstanding, along with the afternoon’s 2316.75 bias-up target.

Overnight action’s new info…
Sunday night’s open surged 3 points and attacked Friday’s 2315.75 high to within 1 tick. Its consolidation soon broke to new highs at 2318.00. Just enough complexity along the way created a “new Globex trend extreme” that requires eventual retest intraday. That didn’t prevent retracing the entire surge back down to its 2313.50 origin. Its reaction has been ranging narrowly, and is now firming up to 2317.00.

If, then…
Thursday’s breakout now eventually requires at least a third higher close. And being a new trend high close on a Friday also requires another eventual new trend high close. Neither of which prevents an immediate pullback. Nor does last night’s “new Globex trend extreme” — which is a landmark, not an attraction. Two actual attractions left outstanding Friday were neutralized overnight. Meanwhile, having printed a new trend high, exiting the open under the overnight low would start to suggest a temporary corrective retracement is underway to 2304.50, 2297.00, or deeper. Opening strength that retests Friday’s 2315.75 and 2316.75 ” unfinished business above” would still be vulnerable to reversing down. Extending higher, instead, would have potential to test 2327.00-2330.00.

First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 under 2314.50 would be unlikely to trigger the 2317.00 bias-up signal at 10:15. Exiting the open above 2318.75 would be likely to trigger bias-up.

Proper context can start the day with a solid win and make all the difference.

NEW DAILY SCHEDULE
First, watch the pre-open Tour recording HERE <<==
Then, meet in the chaRTroom here by 9:15 ET for updates and Q&A

Through the prior close…
Gapping up Thursday above prior highs to 2294.00 was maintained, and extended through the morning’s bias environment up to 2306.00. Consolidating back down to 2302.25 was retraced in time to surge out of the afternoon’s bias environment. But only to attack 2308.00 before hesitating, and then reversing back down to 2303.00 — still qualifying easily as a breakout.

Overnight action’s new info…
Thursday’s highs were soon recovered, and then probed up to 2309.50. The portion of price action above yesterday’s 2308.00 high lacked the complexity that would otherwise form a “new Globex trend extreme.” So, there is no requirement to retest the overnight high. But it’s still currently in proximity, as it reacted down only 2304.75.

If, then…
No traction was gained by yesterday’s rally, so probing above it is potentially only noise. Extending the rally durably this morning would require gapping up above yesterday’s 2308.00 high. Not gapping up could still extend higher this morning — probably testing 2311.00 — while remaining vulnerable to trending back down through the afternoon. Regardless of the open’s setup, extending higher would next target 2327.00. This being a Friday, the morning’s bias tends to persist through the noon hour.

First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 above 2308.00 would be likely to trigger the 2307.00 bias-up signal at 10:15. Exiting the open under 2302.75 would be unlikely to trigger bias-up.

Proper context can start the day with a solid win and make all the difference.

NEW DAILY SCHEDULE
First, watch the pre-open Tour recording HERE <<==
Then, meet in the chaRTroom here by 9:15 ET for updates and Q&A

Through the prior close…
Wednesday’s late 2292.00 high finally touched the objective that had been put into play by holding a test of the morning’s 2283.50 bias-down signal. The intraday recovery fought through natural resistance at the gap back to Tuesday’s 2288.00 close. Its morning peak and noon hour consolidation had hovered pessimistically short of the overnight highs. And the afternoon had already neutralized the objective to within 3 ticks. The recovery didn’t gain traction and enough time remained to react down, but the balance of the session only ranged narrowly sideways.

Overnight action’s new info…
Having satisfied the 2292.00 upside objective, Globex initially retraced back down to 2287.25. A gradual recovery paced itself to greet Europe’s opens back at 2292.00. Its corrective dip and three-hour consolidation eventually resolved up by surging sharply to 2296.25.

If, then…
Like the two prior sessions, new highs still remained likely despite Wednesday also being entered pessimistically. And since the intraday recovery didn’t gain traction for its effort, gapping up is the only credible start to a morning rally. The two-week old 2299.50 “new Globex trend extreme” still requires a retest, which is likely also to visit 2311.00. New highs are vulnerable to reversing down abruptly and sharply, especially if produced abruptly and sharply, which gapping up suggests. All of which can still be avoided by retracing deeply enough pre-open to avoid gapping up.

First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 above 2294.25 would be likely to trigger the 2292.75 bias-up signal at 10:15. Exiting the open above 2299.50 would be likely also to exceed the 2297.75 bias-up target at 10:15 to renew the bias-up signal. Exiting the open under 2291.25 would be unlikely to trigger bias-up.