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…
Probing overnight under Monday’s 2662.50 low by 4 points was largely repeated through Tuesday’s open. But Monday afternoon’s slide didn’t resume, and bias down didn’t trigger. Wash, rinse, repeat. The morning’s bounce up to 2674.25 was retraced to fresh lows during the noon hour. But the afternoon’s bias-down signal didn’t trigger, either. Wash, rinse, repeat, again. A shallower bounce to 2669.50 was reversed to session lows at 2652.25, and — in-line with the session’s tradition — also bounced. Monday’s 2670.00 close was being tested at the close to essentially finish the session unchanged.

Overnight action’s new info…
Tuesday’s last bounce was extended into Globex to probe 3 points above Monday’s 2670.00 close. Its reaction down to 2666.50 was narrowly consolidated, and almost entirely recovered to test 2672.00. A 3-point dip ahead of Europe’s opens (defensive posturing) was recovered back up to and through the earlier high — first a little, and then a lot, extending to 2684.50. Its reaction is now testing 2681.00 as support.

If, then…
Recovering from several intraday dips can form accumulation. That’s the basis for a bottom, but the setup isn’t complete until triggered. Tuesday’s recoveries stopped short of producing a trigger, including the close which was not above a prior high or resistance. But gapping up Wednesday can serve as a proxy for that role. Meanwhile, even the most bearish scenario did not preclude retesting Monday’s highs up to 2684.25. Now Wednesday’s open is indicated to gap up  Having tested 2684.25 overnight, holding its retest through the open could launch a reversal down. Tuesday’s accumulative behavior can be more bullish only by attracting reinforcements, which is difficult when gapping up to resistance. Extending higher through the open would suggest that reinforcements had arrived, introducing potential to 2696.75.

First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 above 2684.25 would be likely also to exceed the 2681.00 bias-up target at 10:15 to renew the bias-up signal next targeting 2693.00. Exiting the open above 2677.00 would at least be likely to trigger the 2674.00 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…
Already rallying overnight up to the 2674.00 objective created a new requirement for extending the rally, or else it would fail. The requirement was fulfilled by exiting the open above 2674.00 to prevent trapping shorts. Renewing the bias-up signal a half-hour later helped, too. But the next higher target at 2684.25 was only attacked, and only eventually, as the underlying strength’s influence mostly applied to recovering dips. The afternoon’s probe to fresh highs only stretched the rubber band up to 2681.50, and then snapped it back down to 2662.50. Oversold RSIs and the gap back down to Friday’s futures close provided obligatory support that reacted up to its 2672.00 objective.

Overnight action’s new info…
Yesterday afternoon’s drop has resolved down, but not immediately. Monday’s late bounce up to its 2672.00 was initially retraced to test 2665.00 through the Globex open. Two more attacks on 2672.00 reacted down to higher lows, forming an Ascending Triangle. Blipping up at Europe’s opens only stretched the rubber band, which snapped back down through the Triangle’s uptrending support. The sentiment shift developed into a 2-hour slide that has probed yesterday’s low to twice test 2659.00–2660.00.

If, then…
Having originated at Thursday’s lows, did the latest recovery attempt peak yesterday at 2681.00 instead of 2684.25? That’s likely, but it doesn’t prevent retesting yesterday’s highs today. Not even the overnight probe under yesterday’s late low prevents retesting yesterday’s highs today. Entering a timing window even just attacking Friday’s late dip to 2657.00 would likely prevent retesting yesterday’s highs… for a long time. After spending almost all of Monday in hover mode, there’s no reason to further delay its afternoon slide. So, no reason to further delay the slide, and indicated to open near a pivotal point — if these two such bearish conditions can’t produce a bearish open or bearish morning, then a retest of yesterday’s high could still develop.

First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 under 2659.00 would be likely to trigger the 2663.00 bias-down signal at 10:15. Exiting the open above 2668.50 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…
A weak reaction to Friday morning’s Employment Situation report was likely to be false. So, gradually dipping under the overnight range’s 2623.50 lows down to 2612.25 held its test of the 2620.00 bias-down signal before rallying back up through the open. And through the bias timing window, and into the noon hour. The morning’s rally was no-bias trending that would have required being retraced, except its sponsorship exited the bias environment above its bias-up target. The rally extend through the noon hour to trigger bias-up, exceeding the afternoon’s bias-up target to exit the bias environment at 2669.25. Its reaction down to 2657.00 bounced 6 points into the close, overlapping Wednesday’s 2658.50 high.

Overnight action’s new info…
Sunday night’s open spiked up slightly to attack Friday’s high, and soon surged to probe it up to attack 2673.00. Flat to higher ranging since then has held this morning’s 2668.00 bias-up signal tests as support. Attacks on this morning’s 2674.00 bias-up target are now being exceeded by a surge attacking 2676.00.

If, then…
Only overlapping Wednesday’s 2658.50 high at Friday’s close meant that extending to 2674.00 and 2684.25 was not necessarily in-play. Gapping up today could have qualified as a signal by proxy. Thta was until 2674.00 was neutralized to within 1 tick overnight. Now, the extension can be signaled by recovering 2674.00 through the open. A pullback through the open could still be absorbed, and ranging through the morning could resolve up. But touching 2674.00 must exit that window above it, or else risk attracting strong-handed sellers. Dipping back into negative territory wouldn’t be easily tolerated, nor would any price action that suggests Wednesday’s 2658.50 high is holding as resistance.

First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 under 2664.00 would be unlikely to trigger the 2668.00 bias-up signal at 10:15. Exiting the open above 2670.75 would be likely to trigger bias-up. Exiting the open above 2677.00 would suggest the 2674.00 bias-up target will be exceeded through 10:15 to renew the bias-up signal, next targeting 2684.25.

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…
Thursday’s 2623.50 opening print was already under Wednesday’s last-minute 2629.00 low. And it quickly resolved down, eventually a lot, attacking 2591.00 at the bias environment low. Already bouncing into the noon hour was extended through the noon hour, and then a little higher to 2632.50 at the bias environment high. That was actually probed momentarily by 2 points while ranging sideways through the close, supported by 2623.50… the opening print..

Overnight action’s new info…
It’s certainly possible that the momentum of Thursday afternoon’s recovery was absorbed by the negative news story about the President’s lawyer. Or, not: Almost completely retracting its first two versions hasn’t seen any effect. Sideways ranging has been contained between 2623.00-2633.50, remaining within yesterday’s late range.

If, then…
Yesterday afternoon’s bias environment was greeted by two strong trending actions, which usually produces one more. But yesterday afternoon’s bias environment didn’t. It ranged narrowly sideways, which was least likely. This doesn’t invalidate the setup, rather it increases the stored energy, making a powerful move likely. It could have developed overnight, but narrow ranging persisted instead. If the Employment Situation report’s reaction is only shallow, then I’ll expect it to expand throughout the day. Otherwise, since no traction was gained yesterday afternoon, gapping open beyond either end of yesterday’s range is likely to extend in that direction.

First Trade…
[Click here to view the Bias parameters] No preliminary indications are considered ahead of an Employment Situation report.

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 afternoon’s rally from 2623.00 up to 2658.00 was corrected overnight but also recovered overnight to up to 2658.50. But no higher, despite the afternoon rally having gained traction. Monday’s decline had not attracted durable buying overnight, either. The consequence to each was morning weakness. Wednesday’s weakness reflected anxiousness ahead of the afternoon’s FOMC policy statement, which reacted back up to 2658.50. That was until the bias environment exit, which suddenly rejected the recovery, leaving behind overbought RSIs yet to be retested. The balance of the session plunged to 2629.00, retracing nearly all of Tuesday afternoon’s rally. A small late bounce was early enough to close back above 2630.50 and avoid triggering a hold-short setup.

Overnight action’s new info…
The plunge initially extended to 2624.25, stopping optimistically short of touching Tuesday afternoon’s 2623.25 low. A bounce to 2630.50 was retraced entirely back to the low, which was recovered back up to 2630.50. Europe’s opens were greeted at the upper-end of this channel, which then broke higher to 2636.25. Now that has been retraced entirely back down to 2628.00.

If, then…
Isolating the overnight lower lows by opening Thursday back above 2635.00-2638.00 would be bullish. That was being attempted after Europe’s opens, and now not so much. There’s still time, but only a little. Retesting overnight lows and recovering into the noon hour might still be able to launch a recovery. In either case, the upside reward is a retest of Wednesday’s 2658.50 high, which would all but ensure retesting Monday’s 2783.25 high. Extending yesterday afternoon’s plunge could start to topple the dominoes still waiting below. .

First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 under 2633.00 would be unlikely to trigger the 2638.25 bias-up signal at 10:15. Exiting the open above 2630.50 would be unlikely to trigger the 2626.00 bias-down signal.