The First Trade

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

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 open was greeted near the lower-end of overnight ranging at 2719.00, ranging that had broken lower temporarily down to 2709.00. The recovery extended during the morning to probe above Thursday’s 2736.50 highs, and then dipped. A noon hour probe to higher highs attacked 2749.00, and then dipped. One more probe above Thursday’s highs got to only 2745.00, and then dipped, but recovered back up to 2745.00. Closing at or above Thursday’s highs avoided rejecting or invalidating Thursday’s bottoming pattern, but didn’t quite confirm that momentum was reversing up. The bearish WedEX influence was nominal, holding under the noon hour’s highs, and the last dip retesting the bias environment’s entry.

Overnight action’s new info…
Sunday night’s open was greeted by two negative news items, as both US-China trade and PM May seemed to be falling apart. Gapping down under Friday’s last dip touched 2729.00 as a narrowing range formed around this morning’s 2734.00 bias-down signal. Surging into and out of Europe’s opens attacked Friday’s highs up to 2748.00, but only briefly. And only temporarily, now having retraced the surge back down to attack 2730.00.

If, then… (notes to accompany the Tour recording)
Friday’s borderline bearish WedEX influence is enough for initial post-open selling pressure to be credible for producing bearish behavior until this morning’s bias environment lapses. No immediate post-open bearish behavior wouldn’t necessarily be bullish, but should be, since earlier overnight weakness would have failed to attract reinforcements. Regardless, morning trending in either direction would remain vulnerable to reversing direction through the afternoon.

First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 under 2731.75 would be likely to trigger the 2734.00 bias-down signal at 10:15. Exiting the open under 2741.75 would be unlikely to trigger the 2744.00 bias-up signal. Exiting the open above 2746.00 would be likely to trigger bias-up.

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

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 night’s multiple double-digit swings were nonetheless contained within the late-afternoon range. A breakout attempt occurred within 30-60-90 minutes of Thursday’s open, which is our Globex range late breakout setup. Waiting so long to both breaking the overnight range tends to be false. Which it was, reversing back into and through the wide overnight range. Not before the false breakout could be very productive, probing under Wednesday’s 2686.25 low to attack 2671.00. Its recovery back up to 2711.00 was corrected during the noon hour, then recovered further to enter the afternoon bias environment above the 2717.00 overnight high. Ultimately, the recovery extended to attack 2737.00 into the bias environment exit, which was retested after dipping to 2711.00.

Overnight action’s new info…
A relatively narrow 9-point range between 2722.50-2731.50 persisted through Europe’s opens, before finally breaking one way or the other. That eventual break is lower, attacking 2714.00, under this morning’s 2717.75 bias-down target. It’s more than 61.8% beyond the earlier overnight range, but only now challenging the lower-end of yesterday afternoon’s range.

If, then… (notes to accompany the Tour recording)
A second consecutive lower close Thursday would have confirmed Wednesday’s preliminary signal that the trend was extending down. The rejection can be as bullish as it would have been bearish. But the setup offers only a narrow window to leverage the trapped sellers into attracting strong-handed buyers that actually reverse the trend up. More so today, because the bearish WedEX is scheduled to influence this afternoon’s price action. Not already rallying this morning would make that afternoon influence capable of resuming the week-old decline. Extending the rally up to a more defensible position can’t afford to wait too long before beginning.

First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 under 2719.00 would be likely at least to trigger the 2724.75 bias-down signal at 10:15. Exiting the open above 2726.00 would be unlikely to trigger bias-down.

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

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 night’s probe of fresh lows down to 2711.00 was recovered and reversed to attack 2745.00 through Wednesday’s open. All of which was retraced and reversed through the afternoon bias environment down to fresh lows at 2686.25. Which is within 1 tick of the next lower objective at 2685.00-2686.00. Its reaction up to 2723.50 was largely retraced down to 2697.00 before the close. WedEX triggered actively bearish, although no “unfinished business” below was left outstanding.

Overnight action’s new info…
2-3 wide swings during Globex have all fit within yesterday’s late range. The reaction down from Wednesday’s late surge extended down to within 3 points of the intraday low, repeatedly probing 1-2 points under this morning’s 2691.25 bias-down signal. Rallying 27 points to within 1 tick of this morning’s 2717.00 bias-up target stopped 6-1/2 points short of retesting Wednesday’s late surge. Reacting down 23 points to 2694.00 has bounced again to 2710.00, testing the resistance of this morning’s 2709.00 bias-up signal.

If, then… (notes to accompany the Tour recording)
Wednesday’s 2686.00 low fulfilled the next lower objective of the week-long pullback from last Wednesday night’s 2818.00 high. The leg is testing the pre-election pullback low at 2700.00, while its low retraces 61.8% of the three-week old 2603.00 low, and fills the gap back to the low session’s close. There is plenty of support, and no nearby or recently created attractions below, so a rally is free to begin. Not exploiting the opportunity to rally today would suggest the decline intends to extend to its next lower targets at 2654.00 and 2635.00. Meanwhile, the bearish WedEX could be inverted by opening high enough Thursday could still trigger a late passive bullish WedEX, or else confirm a bearish outlook for tomorrow afternoon.

First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 under 2705.00 would be unlikely to trigger the 2709.00 bias-up signal at 10:15. Exiting the open above 2711.00 would be likely to trigger bias-up.

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

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’s open foreshadowed the session, and not just for ignoring several recovery opportunities. Its 5-point gap up first extended higher, and was soon reversing down on its way to fresh lows. The pattern repeated intraday, recovering again to fresh session highs well before noon. The balance of the session trended back down to retest the morning’s lows, which held through the close. Session lows retraced all of last week’s gains back down to the prior Friday’s close. Closing just 1 point under Monday’s close was essentially unchanged, but it wasn’t back above a prior high which would have trapped sellers — perhaps not a bad showing after the open had ignored its recovery opportunities.

Overnight action’s new info…
Globex immediately rallied out of Tuesday’s close to attack 2744.00. Its consolidation was contained within what is this morning’s 2735.50-2742.25 bias-up parameters. Buyers never attracted reinforcements before resolving down to 2725.00 well before midnight, where another consolidation formed around unchanged. Breaking lower again into and out of Europe’s opens slid sharply for two hours until touching what is this morning’s 2711.00 bias-down target. A two-hour rally from there back to unchanged around 2725.00 has recovered a brief dip to now test 2730.00.

If, then… (notes to accompany the Tour recording)
So, is the market stair-stepping its way down to the next lower targets, which are 2696.00 and then 2786.00? Last night’s low repeated Monday night’s momentary dip under the intraday low, albeit much later in the session than Monday night’s initial dip. Bottom-fishers haven’t been comprised of strong-handed buyers, as seen by ending each period at or near its lows. Strong-handed buyers would push a timing window through a relevant resistance — this morning, that would be back above yesterday afternoon’s 2740.50 high, which already held last night’s initial strength.

First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 under 2715.00 would be likely to trigger the 2718.00 bias-down signal at 10:15. Exiting the open above 2721.75 would be unlikely to trigger bias-down. Exiting the open under 2732.50 would be unlikely to trigger bias-down.

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

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…
Monday was the third consecutive downtrending session spent exclusively in negative territory. Sellers were refueled by an overnight rally to the morning’s 2795.50 bias-up target. But the open was already back down at its 2775.00 bias-down signal. The first hour collapsed to 2733.00, which supported a range back up to 2752.00 through the afternoon bias environment. The proxy window finally broke lower to 2722.00, retracing all of last of last week’s rally — before Wednesday’s election results surge, back down to the prior Friday’s close.

Overnight action’s new info…
A brief bounce resolved down to a fresh low at 2719.00, testing what is this morning’s 2720.00 bias-down signal. Not much lower, and also not extended, so easily retraced back up to 2745.00 by midnight. Its reaction down to 2733.00 was just retested, following an interim surge up to 2750.00. That is potentially the head of a Head & Shoulders pattern, with its neckline being 2733.00. The 2745.00 shoulder has been recovered, and is being probed almost too much to maintain the Head & Shoulders form.

If, then… (notes to accompany the Tour recording)
Overnight action contains multiple reversal patterns, waiting to be triggered, all of which can be ignored. Head & Shoulders: Dipping back under the Head & Shoulders 2733.00 neckline would trigger the reversal pattern, targeting a retest of at least yesterday’s lows, and potentially resuming the decline. The pattern doesn’t always reverse price action, and extending higher would entrench the overnight recovery. Leapfrogging over interim resistance at 2739.00-2743.00 at Tuesday’s open would be the quickest signal of rejecting Monday’s decline. Isolation: An Isolation setup would form by avoiding a dip back down to yesterday’s low since it was probed overnight. Session-long Rally: Maintaining and extending a gap up to and or through Monday afternoon’s 2752.00 high would form a session-long rally setup. Otherwise, resuming the decline could reach 2786.00 before its next opportunity to try bottoming again.

First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 above 2743.00 would be likely to trigger the 2738.50 at 10:15. Exiting the open under 2733.00 would be unlikely to trigger bias-up.