Market Wrap
Market Wrap (recording & summary)
Thursday’s gap up opened at the 2384.00 bias-up signal, and quickly slid down to its 2376.00 bias-down signal. Probing under it in the morning only briefly pierced 2374.00. Probing under it in the afternoon only briefly pierced 2374.00, too. The interim bounce held 2380.00.
Trading out the day range-bound was the session’s least likely scenario. It creates pent-up pressure that is likely to be released by gapping open Friday. Meanwhile, an overnight dip could neutralize the attraction back down to 2370.50 where Wednesday’s FOMC news was greeted, and recover in time to gap up Friday. But probing higher overnight would more likely maintain a gap up and extend higher into the weekend.
Details and other markets coverage are discussed in the post-market Wrap recording here.
Monitor overnight Globex trading in the chaRTroom here.
Market Wrap (recording & summary)
Wednesday’s rally probed the 2385.50-2386.25 target and attacked 2388.00. Overbought RSIs at the high will require its retest, regardless of the concurrent vulnerability to another corrective pullback. In fact, a late steep drop into Wednesday’s close fell 9 points to attack 2378.00.
It’s impressive that Tuesday’s drop apparently sufficed for expressing anxiousness ahead of the FOMC. But that lack of any other pre-news or post-news reaction down is what has created a vulnerability to another corrective pullback. Something longer and deeper than Wednesday’s late 9-point dip.
Meanwhile, we should take a snapshot of the bigger picture before the subject changes from rally to top. Especially at this moment as the FOMC session proves out several suspicions and expectations that were guiding us the past two weeks. All of which is centered around the 6-7 day pullback and its testing of the prior week’s “lower prior highs.”
Expectation for an imminent recovery was reinforced by several ongoing observations. Holding the “lower prior highs” was key to being only a temporary dip, but didn’t speak to timing a reversal. That was done by last week’s Thursday-Friday two consecutive positive closes. Even that remained vulnerable to a quick correction, which Tuesday’s drop provided.
Gapping up Wednesday helped to prove Tuesday’s drop was only temporary, and done. Actually, maintaining Wednesday’s gap up through the open was itself a bullish setup, because it did not immediately reject Tuesday night’s one-way relentless overnight rally.
All of which fulfills the bigger picture expectations that the FOMC move was not only anticipated by market participants but welcomed. And that the chorus of bearish market gurus did reach a crescendo last week — the 6-7 consecutive downtrending sessions had absorbed their selling so that the next upleg could begin.
Maybe that next upleg is already ended. Maybe it is on its way back up to and through the two-week old highs to 2401.00 or 2415.00. Regardless, it continues to be vulnerable to being short-lived and quickly rejected when its upside is done.
Details and other markets coverage are discussed in the post-market Wrap recording here.
Monitor overnight Globex trading in the chaRTroom here.
Market Wrap (recording & summary)
Tuesday morning’s trend change setup from fulfilling 2355.00 had produced an 8-point bounce into noon. Its 2363.00 high was retested after recovering from the noon hour’s 6-point dip. Which was still at least 8 points under Monday’s close.
Tuesday’s dip can qualify as the correction of Thursday-Friday’s two consecutive higher closes (Monday’s close was technically higher, but its intraday pattern had rendered it irrelevant). If that was the correction, than resuming the rally requires no further delay — no need to back-and-fill.
Meanwhile, despite the low’s trend reversal, Tuesday afternoon’s recovery didn’t recover any prior highs. There remains a vulnerability to retesting Tuesday’s low, potentially probing under it to test 2351.00. Even that fresh low could recover to resume last week’s Thursday-Friday recovery — if it can prevent sponsorship ahead of the afternoon’s FOMC from pushing price over the edge.
Details and other markets coverage are discussed in the post-market Wrap recording here.
Monitor overnight Globex trading in the chaRTroom here.
Market Wrap (recording & summary)
Has anxiousness ahead of Wednesday’s FOMC meeting already begun to paralyze price action? Do HFT algos stay offline coming out of daylight savings adjustments as the market absorbs the circadian shock?
Monday was essentially a so-called nothing burger. Its positive close isn’t cumulative to the prior two for signaling strength. The inside day isn’t even contrarian, as no timing windows trended. Both the morning and afternoon’s no-biases triggered without touching either bias signal.
The same predictive behaviors defining Monday’s open can be applied Tuesday. A retest of Thursday’s low is still a risk. Resuming the rally is likely, regardless.
Details and other markets coverage are discussed in the post-market Wrap recording here.
Monitor overnight Globex trading in the chaRTroom here.
Market Wrap (recording & summary)
The relentless overnight rally up to 2376.25 was captured by the intraday open. Post-open action caged it, becoming easy prey for the afternoon’s sellers. But the afternoon’s attempt at killing the beast did not succeed. Not for lack of trying — the 2359.75 bias-down target was met. But it was met prematurely, which essentially marginalized sellers for the day.
Having been marginalized, albeit only essentially and not utterly, it was sellers’ turn to be exploited. Recovering the 2365.75 bias-down signal coming out of the afternoon’s bias environment trended up relentlessly into the close. RSIs diverged negatively into the bounce’s 2370.00 peak.
Friday was a second consecutive positive close. It was the first in seven sessions not to probe fresh lows intraday. And it creates a special setup that can launch a retest of the prior week’s highs. (I’ll describe its parameters this weekend*.)
Details and other markets coverage are discussed in the post-market Wrap recording here.
*JOIN US FOR THE SATURDAY REVIEW AT 9:30AM ET… LOOK FOR AN EARLY MORNING EMAIL WITH ITS LINK.