Market Wrap

Recovering almost all of Tuesday’s post-open drop by noon was no small feat. Ten points down to 2129.00 in an hour, and almost 10 points up in 90 minutes back to 2138.50 — after rallying 18 points overnight — take a rest. Which the noon hour and afternoon’s no-bias environment did, and it was a well-deserved rest, ranging narrowly between 2135.00-2137.50.

The narrow ranging persisted halfway through the last 60-90 minutes, which was less deserved. The two prior timing windows hovered pessimistically short of simply touching the morning’s high, let alone probing it or the 2139.75 pre-open high. So, eventually breaking lower came too late to be sponsored by strong hands.

And the late break lower triggered a sell signal under 2135.00 that fulfilled its 2130.50 target. Weak-handed sellers, fulfilling their selling pressure. Gapping up Wednesday would be the appropriate start to resuming the rally. And after trending down into the close, gapping up above Tuesday afternoon’s 2138.00 high would form a “session-long rally” setup.

Not exploiting any of these otherwise bullish inputs would be as bearish as the pattern could have been bullish. Breaking under Tuesday morning’s 2129.00 low would essentially resume the decline.

Details and other markets coverage are discussed in the post-market Wrap recording here.

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Monday’s session was too narrow to offer much information. But for being so narrow, it accomplished a lot. And some of what it accomplished was the creation of objectives that were left outstanding — i.e. “unfinished business,” both above and below.

A test of the morning’s 2132.25 bias-up signal was put into play, but only attacked to within 3 points. The afternoon’s 2116.00 bias-down target was put into play, and attacked to within 2 points.

Buyers didn’t gain traction, so rallying requires gapping up, above 2129.00-2130.00, and also above 2132.25 if touched during the open. Holding a test of 2132.25 could slingshot the market back down under Monday’s lows. And that would target a retest of Thursday’s 2107.75 low down to at least 2105.00.

Details and other markets coverage are discussed in the post-market Wrap recording here.

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Friday afternoon was ueventful. The noon hour’s 2126.50 low had been recovered in time to avoid triggering the 2128.75 bias-down signal, and the no-bias environment bounced to test its 2136.00 bias-up signal. Reacting down held the 2128.75 bias-down signal through the no-bias environment, and then broke to fresh post-open lows at 2125.00 through the futures close.

That’s back under Wednesday’s prior high, whose recovery through Friday’s open had opened the door to much highs intraday. The door remains open, since positive territory was maintained. But it must be exploited Monday in a specific way to avoid being considered as only Friday noise, and otherwise irrelevant.

Details and other markets coverage are discussed in the post-market Wrap recording here.

I’ll send the Saturday Review link overnight .

Testing higher prior lows at 2131.00-2132.00 ultimately reacted down 6-1/2 points to 2123.75 at Thursday’s cash session close. Holding higher prior lows prevents gaining traction. That’s a mixed signal with the afternoon’s timing traction indicator, of exiting the bias environment and entering the final hour, That had indicated the rally did gain traction. Both signals can be fulfilled by trending up through the morning after gapping down, or by gapping up above the afternoon’s 2132.25 recovering high.

The latter setup would delay fulfilling a third signal, which requires retesting oversold RSIs at Thursday’s 2107.75 low. Of course, that “unfinished business below” could be delayed, probably through the weekend after gapping up on a Friday. But that’s not optimal. Anyway, its test is likely to visit 2105.00 if not also 2095.00. A bigger bounce first could reach 2149.00.

Details and other markets coverage are discussed in the post-market Wrap recording here.

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The last FOMC meeting’s minutes were released Wednesday afternoon. They suggested a rate hike was missed more narrowly than first suspected, and therefore closer than was thought. The low-volume, low volatility session didn’t have much of a knee-jerk reaction to the “bad” news, dipping 3-4 points to 2133.00. Having the event become history essentially triggered a relief rally up to 2139.50.

But there was nothing accumulative about the pattern. And volume was no greater. So the balance of the session drifted choppily back down to fresh lows attacking 2131.00. Remember that was Tuesday’s cash session close, and opening there Wednesday had already warned us that intraday trending would be unlikely.

A bullish scenario would have exploited the low-volume environment and neutralized Tuesday’s oversold RSIs on Wednesday, when it was difficult to trend. Instead, the attraction is left outstanding at 2121.75, likely to be retested Thursday, unless the open is already extending up from a gap up above Wednesday’s 2139.50 high.

Details and other markets coverage are discussed in the post-market Wrap recording here.

Monitor overnight Globex trading in the chaRTroom here.