The First Trade

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

CHARTROOM LINK(s)
o Win XP-Friendly entry
o non-xp friendly (ilinc)
(pre-open Market Tour begins at 8:55 ET)

Through the prior close…
Gapping down Tuesday within Monday afternoon’s range wasn’t likely to extend down, and was likelier to recover. Which it did, bouncing through the morning from 2019.50 to 2031.50. That was also essentially a move from one bias signal to the other. Being a no-bias environment with plenty of time remaining, price reversed back down into the afternoon’s bias environment. Retesting the morning’s low initially held, reacting up to 2027.00. But that reacted back down into the close.

Overnight action’s new info…
The closing reaction down extended quickly to 2015.75, 3 ticks under Monday’s low. Then a steep rally into and out of midnight touched 2034.25. Its reaction down to 2020.50 was reversed back up to 2031.75, which essentially repeated Tuesday morning’s rally (both circled green on the chart).

If, then…
An early surge to fresh highs and that reacts down as quickly and as sharply, that’s the topping template we’ve been monitoring in this area. Yesterday’s post-open surge and its reaction back down almost fit, except that its timing followed an early dip. Last night’s surge and reaction down almost fit, too, except for being last night and not intraday. An early post-open surge that quickly reverses down would be credible for extending down intraday. But not rejecting an early surge could put the next higher objective in-play at 2055.00.

First Trade…
Exiting the open at 9:45 above 2027.50 would be likely also to trigger the 2026.25 bias-up signal at 10:15. Exiting the open under 2023.00 would be unlikely to trigger bias-up.

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

CHARTROOM LINK(s)
o Win XP-Friendly entry
o non-xp friendly (ilinc)
(pre-open Market Tour begins at 8:55 ET)

Through the prior close…
Monday’s choppy session didn’t contribute to the rally, other than to prevent a Pivot Reversal from forming. Its late-morning and last-minute surges pierced 1-2 points above Friday’s 2026.00 high, stopping just short of Sunday night’s 2028.00 high. Each intraday leg overlapped 2019.50.

Overnight action’s new info…
Shallow sideways ranging never pierced Monday’s late high. The only real trending attempt came well after Europe’s opens, dropping back down to test 2019.50. A consolidation there has launched a surge to 2023.50.

If, then…
Not yet rejecting last week’s test of 2019.50 has all but ensured at least probing momentarily higher to the 2031.75 area. Gapping down within yesterday’s range would be too shallow to launch a new downleg. Gapping down under yesterday afternoon’s 2016.50 low could form a “session-long decline,” which is an unlikely development at this stage of the pattern, but only more likely as the overnight drop has halved the distance back to yesterday’s low.

First Trade…
Exiting the open at 9:45 under 2019.50 would be likely also to trigger the 2020.50 bias-down signal at 10:15. Exiting the open under 2024.50 would be unlikely to trigger the 2031.00 bias-up signal at 10:15., and above 2024.50 would be unlikely to trigger bias-down.

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

CHARTROOM LINK(s)
o Win XP-Friendly entry
o non-xp friendly (ilinc)
(pre-open Market Tour begins at 8:55 ET)

Through the prior close…
Thursday’s gap up grudgingly triggered its 1995.50 bias-up signal and grudgingly fulfilled its 1999.50 bias-up target. Exiting the bias environment back under its fulfilled bias-up signal down to 1989.50 indicated that grudging sponsorship was gone. But sellers proved to be more grudging than the morning’s buyers, and could not be attracted at all. So, a much more willing round of buying emerged, taking the noon hour to fresh session highs. The afternoon’s bias-up environment extended the rally to fulfill its 2007.50 bias-up target. And the rally extended through the cash session close to touch its ultimate objective at 2019.50.

Overnight action’s new info…
An early thrust higher tried to reignite the afternoon’s magic, and did touch 2023.00. But soon began reversing down to 2016.00. Bouncing back up to 2022.00 has been reversed down to lower lows testing 2014.00.

If, then…
Trading choppily overnight is proof that yesterday afternoon’s rally was a function of today’s expiration. That’s interesting, since it fulfilled a significant upside objective at 2019.50 and WedEX is forecasting a bearish afternoon. Meanwhile, this being expiration, trending through the opening 15 minutes of volatility can forecast trending throughout the day. And this being a Friday, the morning’s bias tends to persist through the noon hour.

First Trade…
Exiting the open at 9:45 above 2019.50 would be likely to maintain that recovery through 10:15 to trigger bias-up. Exiting the open under 2016.00 would be unlikely to trigger the 2019.50 bias-up signal at 10:15. Exiting the open under 2007.50 would be likely to trigger the 2011.00 bias-down signal at 10:15.

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

CHARTROOM LINK(s)
o Win XP-Friendly entry
o non-xp friendly (ilinc)
(pre-open Market Tour begins at 8:55 ET)

Through the prior close…
Wednesday’s opening rally up to the morning’s 2001.50 bias-up signal was reversed through the morning to test the 1988.00 bias-down signal, and its room for noise down to 1985.50. A noon hour bounce to 1998.50 spent the afternoon probing fresh lows down to 1982.50. The slide gained traction, albeit as indecisively as possible.

Overnight action’s new info…
Initially firming back up to 1988.00 soon launched a rally that had retraced yesterday’s 1998.50 high into Europe’s opens. Ranging choppily there since then has touched 2000.00.

If, then…
Regardless of whether yesterday’s slide gained traction decisively, rejecting that traction requires decisiveness. That means gapping up this morning back above a relevant level. Immediately recovering the noon hour’s 1998.50 high would be optimal, but the afternoon bias environment’s 1995.50 high could suffice. Exiting the open any lower — especially if post-open action were to duplicate those levels’ overnight tests — would be vulnerable to probing under yesterday’s 1982.50 low by 2-4 points… WedEX was bearish, having closed successively lower from a multi-session range. Usually, that’s irrelevant until Friday, but it can be negated by proxy at Thursday’s open. That would require maintaining a gap up to and through 2002.25.

First Trade…
Exiting the open at 9:45 above 2002.00 would be likely also to exceed this morning’s 1999.50 bias-up target at 10:15 to renew the bias-up signal. Exiting the open under 1995.50 would be unlikely to exceed the bias-up target, and opening under 1988.00 would be unlikely to trigger the 1993.50 bias-up signal at 10:15.