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…
Wednesday’s late 18-point surge up to 2849.50 was retraced almost entirely overnight down to 2833.25. Thursday’s opening surge was also retraced , as were each of Thursday morning’s higher highs. Ultimately, it was an inside day, gaining no traction either way. But “unfinished business above” was left outstanding at the morning’s 2848.75 bias objective. And attempts to reverse down repeatedly failed. Despite the entire session developing in negative territory, the burden of proof was left on sellers The 4-point differential between cash session and futures 2838.25-2842.50 closes was similar to Wednesday.

Overnight action’s new info…
There was a momentary 9-10 point knee-jerk reaction down and up at the close, triggered by AMZN’s own initial earnings confusion. But the Globex session has only trended up. Attacking yesterday’s 2846.50 high to within 2 ticks before Europe’s opens had reacted down to 2842.75. Later surging 4 points pierced yesterday’s high by 2 ticks has reacted back down to 2842.75, again.

If, then…
No decline was indicated by yesterday’s pattern, only the vulnerability if buyers weren’t retaking control overnight. But, have they? Relentless overnight trending doesn’t always attract intraday reinforcements. And stronger-handed counter-trend sponsorship isn’t necessary to reverse the overnight trend — that can happen simply by the overnight trend’s sponsorship exiting. The opening 15 minutes of volatility often lets us know either way. It isn’t necessary to neutralize the “unfinished business above” at 2848.75 before reversing down, but I’ll be reluctant to short otherwise. Not reversing down would next target 2873.00 and potentially 2883.00, while this leg also requires at least an eventual third higher close. Anxiousness and anticipation ahead of this morning’s GDP is surely inhibiting and influencing price action, so a clearer picture should be visible after its release.

First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 above 2846.50 would be likely to trigger the 2844.50 bias-up signal at 10:15. Exiting the open under 2840.75 would be unlikely 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…
Perhaps limiting Wednesday’s opening 6-point surge to 2826.00 was product of having originated from a position of weakness. Regardless, the consolidation resolved through the morning bias environment exit, and touched 2836.00 during the afternoon bias environment exit. More so, its 3-point reaction down held above Tuesday’s 2831.25 high to avoid reversing momentum down. The shallow pullback within upside momentum met the position-squaring window being vulnerable to a short-squeeze. Perhaps the setup would have triggered organically, but probably not by spiking up 18 points when the US-EU tariff deal was announced. Reacting down from 2849.50 got to 2840.00 before the close, which bounced 61.8% back up to 2845.50..

Overnight action’s new info…
Having been triggered by a headline, Wednesday’s late surge to 2849.50 was likely to be retraced. What the pre-close dip missed, the Globex gap down to 2835.00 nearly completed. The 2833.25 overnight low is close enough to neutralize that setup’s attraction. But we wouldn’t know it from subsequent price action — the balance of the night, the entire night actually, has ranged narrowly sideways between 2834.00-2838.50.

If, then…
The second consecutive close above 2818.00 confirms a new rally leg is underway, requiring at least an eventual third higher close. It’s next higher target 2873.00, and potentially 2909.00. Potentially. The leg’s characteristic should soon become very aggressive. But not necessarily yet, and the proximity to January’s highs could create turbulence this morning. The bullish context could have a near-term bearish influence, too, as it allows a retracement to refuel buyers, maybe no deeper than 2828.50 but with room to retest 2818.00. Trending up again Thursday afternoon could extend through Monday morning.

First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 under 2836.25 would be likely to trigger the 2839.50 bias-down signal at 10:15. Exiting the open above 2842.00 would be unlikely 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 2823.00 open was greeted 15 points above Monday’s 2808.00 cash session close, and 31 points off of Monday’s pre-open low. Monday afternoon’s 2812.50 bias-up target and the Isolation setup’s 2818.00 objective highs had satisfied their buying pressure overnight. And still Tuesday’s first hour extended up to 2831.25. That’s a lot of buying pressure to expend, let alone to fulfill, so reversing back down to 2812.00 was relatively easy. It should have been as easy for the session to end in a short-squeeze, but te last two hours bounced only 10 points back up to 2822.00.

Overnight action’s new info…
After several consecutive windows of robust trending, price action since yesterday’s close has been non-directional. And non-predictive of its direction. It seems that Global markets don’t know what to make of either yesterday morning’s surge or of its afternoon retracement, and they’re not impressed by the higher close. They’re more influenced now by the sudden relative slowness of yesterday’s last two hours, and its range, have contained overnight action. Initially trending back down 8 points through midnight to within 1 tick of this morning’s 2813.75 bias-down signal, the balance of the night trended back up to within 1 tick of yesterday’s last-minute 2822.00 high. Until 90 minutes ago, which has been dropping relentlessly to now retrace the entire recovery.

If, then…
Closing above last week’s 2818.00 prior highs has put into play the next higher objective at 2836.00 — subject to confirmation today, not of a second consecutive higher close but by not closing back under 2818.00. Otherwise, Tuesday’s 2823.00 open above all prior highs wants to be retested eventually from below. Retesting it before closing back under 2818.00 would be bearish, especially if 2836.00 were visited, first. Meanwhile, failing to exploit Tuesday’s late vulnerability to a short-squeeze made overnight action vulnerable to extending Tuesday’s pullback if Wednesday’s open isn’t gap up, which it’s currently not.

First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 above 2816.00 would be unlikely to trigger the 2813.75 bias-down signal at 10:15. Exiting the open under 2821.00 would be unlikely to trigger the 2823.50 bias-up signal.

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…
Sunday night’s retest of Thursday night’s lows down to 2792.50 wasn’t retested intraday, but Monday morning’s 2796.00-2797.00 lows did probe under Thursday’s intraday lows. The entire morning bias environment continually challenged Thursday’s intraday lows, fulfilling the bearish WedEX indicator. Its influence ended as the bias environment lapsed, isolating the probe of negative territory. Friday’s bullish Isolation setup immediately began influencing the balance of the session, which rallied through the close to touch “unfinished business above” at the afternoon’s 2812.50 bias-up target.

Overnight action’s new info…
The Globex open formed a small Ascending Triangle before soon resuming Monday afternoon’s rally. The Isolation setup’s 2818.00 retest was fulfilled by midnight up to 2819.50. Gradually sliding back down 3 points suddenly plunged another 5 points at Europe’s opens down to 2811.00. But it was straight back up from there until attacking the overnight high to within 1 tick.

If, then…
This is a big decision point for the market. Not necessarily in terms of timing, but at least in price. And not necessarily intraday price, but in terms of the close. There is no further unfinished business above as Tuesday’s open approaches, so the rally depends upon intraday action creating one before the close. Sellers aren’t precluded from creating an objective below, but signaling the trend reversing down is unlikely so far above the prior session’s highs. The retest of last week’s 2818.00 highs was always likely to be probed intraday, and the least room for noise above it is 2821.00. The renewed bias-up target would be 2825.25. Reversing down from either would start to rob buyers of their traction, but probably not reverse the trend down. So, the morning might not even try reversing down, and could be much more motivated to probe last week’s highs.

First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 above 2820.25 would be likely also to exceed the 2817.50 bias-up target at 10:15 to renew the bias-up signal. Exiting the open above 2813.25 would be likely at least to trigger the 2811.50 bias-up signal at 10:15.

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…
Initially firming into Thursday night’s Globex session was blind-sided by the first overnight drop, a 17-point plunge to 2793.50. Its recovery back into Thursday’s range up to 2806.00 was hit by a 13-point plunge to 2793.00. Its recovery into and out of Friday’s open retraced the original plunge’s 2810.50 origin. More so, its recovery maintained an open back into Thursday’s range to form an Isolation setup. The morning’s rally created room for the afternoon’s bearish WedEX to influence price back down through Friday’s close and touch Thursday morning’s 2800.25 low.

Overnight action’s new info…
Sunday night’s open blipped-up to touch 2806.00 and soon began reversing down. And down. Thursday night’s lows were pierced down to 2792.50. A chunk of the drop was a single 7-point slide, but no more plunging. And that was before midnight. Flat-to-higher ranging since then has twice tested Thursday/Friday’s “higher prior lows” at 2800.25.

If, then…
So much for Sunday night strength. Honoring the Isolation setup is difficult if this morning were to probe under Thursday’s 2800.00-2802.00 lows. And that’s going to be difficult to avoid if this morning were to honor the bearish WedEX influence, starting at Thursday’s 2800.00-2802.00 lows. Anything can happen before the open, but not much is expected. Overnight price action off of the lows may be forming an Ascending Triangle, whose break would target 2805.00 and 2813.00, which would be plenty of room for the morning’s bearish WedEX influence to develop — given enough time for the Triangle pattern’s overnight influence to develop pre-open, or into the opening 15 minutes of volatility. And given that the Triangle actually breaks higher. The pattern’s uptrending support is being tested now, and back under its 2795.00 connector would start to signal the Triangle is breaking lower, not higher, targeting 2791.25 and potentially 2781.00 down to 2775.00. Remember, both the Isolation and WedEX setup could be simultaneously influential if Monday morning were only to range narrowly sideways above 2800.00-2802.00. That’s no fun.

First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 above 2803.00 would be unlikely to trigger the 2798.00 bias-down signal at 10:15. Exiting the open under 2795.00 would be likely to trigger bias-up.