The First Trade

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

CHARTROOM LINK <<==click here
(pre-open Market Tour begins at 8:55 ET)

Through the prior close…
Gapping up Wednesday remained aloft through the open, not inverting the overnight rally. That didn’t prevent reversing down just minutes later. The reversal extended down relentlessly and substantially, turning a test of 1946.50 into a plunge to 1878.00. That’s new lows, which probed under Monday’s 1892.50 prior low, which had stopped short of its 1881.00 target. Actively bearish WedEX triggered.

Overnight action’s new info…
China’s renewed weakness triggered a brief dip to new lows at 1874.50. it was recovered as quickly as it had developed, and continued improving. Europe’s opens were greeted optimistically attacking 1898.00. That was reversed back down to down to within 1 tick of 1874.50, before bouncing back to 1891.00..

If, then…
There’s nothing predictive about ranging choppily overnight without extending the decline. Ranging choppily intraday wouldn’t be predictive, either. The pattern remains vulnerable to extending down sharply, with the wild card of last-minute expiration jockeying.

First Trade…
Exiting the open at 9:45 above 1885.00 would be unlikely to trigger the 1880.25 bias-down signal at 10:15. Exiting the open above 1993.50 would be likely to trigger the 1891.75 bias-up signal.

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

CHARTROOM LINK <<==click here
(pre-open Market Tour begins at 8:55 ET)

Through the prior close…
Optimism schooling was back in session. Gapping up Tuesday to test 1938.00 had reversed down enough and in time to avoid triggering the 1927.25 bias-up signal. Dipping deeper through the noon hour targeted 1912.00 and 1907.00, and probed an extra point lower. Entering the noon hour at fresh afternoon highs triggered a short-squeeze that extended up to 1935.00.

Overnight action’s new info…
Capture of US sailors triggered a reaction down to 1922.00 into the Globex open. But that was soon on its way to recovery, attacking 1943.00. Its reaction recovered briefly to probe fresh highs up to 1946.50. That’s reacting back down now to attack 1936.00 as support.

If, then…
Yesterday afternoon’s rally gained traction, which this morning should reward by probing higher during the morning. Already probing higher overnight might seem to confirm, but it also risks already fulfilling the higher probe — especially having come so close to the next higher objective at 1948.00. That should be tested, and potentially also 1975.00, so long as the open doesn’t probe into negative territory too deeply or for too long.

First Trade…
Exiting the open at 9:45 above 1941.50 would be likely also to renew the bias-up signal by exceeding the 1939.00 bias-up target at 10:15. Exiting the open under 1931.00 would be unlikely to trigger the 1933.50 bias-up signal.

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

CHARTROOM LINK <<==click here
(pre-open Market Tour begins at 8:55 ET)

Through the prior close…
Plunging about 20 points to 1893.50 at Sunday night’s open had recovered enough to gap up Monday and touch 1929.00. Selling resumed immediately, extending down through the noon hour. The slide ended abruptly after the noon hour upon only barely piercing the overnight low by 1 point. The noon hour’s 1905.50 low was recovered by just enough just in time to prevent sellers from gaining traction. Sellers also failed to gain traction from a steep drop through the 3:10-3:20 timing window that avoided fresh lows. A surge to 1923.00 ended the day unchanged around 1914.00.

Overnight action’s new info…
Monday’s late dip back to unchanged eventually extended down another 14 points to 1899.00. Sympathy for Chinese stocks falling was leveraged by concern for Crude Oil that was probing fresh lows. This morning’s bias-down target happens to be 1899.00, and its reaction extended up to 1912.00 through Europe’s opens. Crude Oil reversed up after a terrorist event in Istanbul triggered a surge that probed yesterday’s opening high to attack 1931.00.

If, then…
Monday afternoon’s low was on the precipice of the precipice. Retesting Sunday night’s low had room below for another 11 points down to 1881.00. The afternoon’s surge’s appearance was very timely, as any lower any later would have pierced an air pocket below. And now another precipice overnight has been recovered from 1899.00 to probe 2 points above Monday morning’s 1929.00 high. It should be noted that Crude Oil is the overnight recovery’s fickle catalyst. Already being oversold from China helped, and from remaining stable through Europe’s opens. While nothing about the pattern suggests it is becoming a durable bottom, sudden pre-expiration detours  can have a dizzying effect. Above 1933.50 could extend to 1948.00 or even to 1975.00 — briefly, and temporarily, but steeply — before another downleg can gain traction. Otherwise, stomping immediately Tuesday on overnight optimism could resume the work of Monday morning’s sell-off.

First Trade…
Exiting the open at 9:45 above 1929.00 would be likely also to trigger the 1927.25 bias-up signal at 10:15. Exiting the open under 1921.00 would be unlikely to trigger bias-up.

This post is a test. Please take a moment to comment in the blog whether you can see this sentence. Thank you!

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

CHARTROOM LINK <<==click here
(pre-open Market Tour begins at 8:55 ET)

Through the prior close…
A positive knee-jerk reaction attacking 1965.00 was triggered by Friday’s pre-open Employment Situation report. But it pierced overnight highs only a little, and only momentarily. Already retracing into the 1947.00 open still tested both bias-up parameters, before rejecting them to put into play tests of both bias-down parameters. The morning bias environment’s new lows at 1924.50 were retraced into the noon hour, but Friday’s last half-hour still capitulated down to 1910.00.

Overnight action’s new info…
Hope springs eternal, indeed. Sunday night’s open had plunged down to 1983.50 into China’s open. That was retraced entirely to greet Europe’s opens flat with Friday’s close. The overnight recovery attempt helped to mute the effects of Friday’s plunge, and the recovery turned positive up to 1928.50. Its reaction down to 1914.00 is still maintaining positive territory.

If, then…
The overnight low stopped 12 points short of its potential to 1881.00, which would be the objective on a retest. A retest of the overnight low does remain possible, and likely, so long as Friday afternoon’s 1938.50 bias environment high isn’t recovered. Attacking it up to 1933.50 would be the optimal corrective bounce, expending as much buying pressure as possible without even beginning to gain any traction for the effort. But already greeting the open anywhere near unchanged around 1912.00 would be likelier just to resume the decline.

First Trade…
Exiting the open at 9:45 above 1928.75 would be likely also to exceed the 1927.25 bias-up target at 10:15, renewing the bias-up signal next targeting 1933.50. Exiting the open under 1923.00 would be unlikely to renew the bias-up signal. Exiting the open at 9:45 under 1912.75 would be unlikely to trigger the 1921.00 bias-up signal at 10:15.