Market Wrap

Patterns often are counter-intuitive. Hovering at 2101.00 through Thursday’s bias environment’s exit, instead of trending up, still reflected optimism. Extending up to 2102.25 into the final half-hour reflected pessimism for being only slightly higher.

But the multi-session pattern has recovered from its opening dip back up to its midweek low. And only back up to its opening dip. That’s restrained optimism, which keeps alive potential for reacting favorably to Friday’s pre-open Employment Situation report.

A next-to-last minute dip to 2099.25 reflected more pessimism, “ineffectual pessimism” whose reaction down held above prior lows. That potential pent-up buying pressure was already spent by a last-minute surge up to 2104.00. and that neutralized the outstanding Globex trend extreme’s attraction. None of which prevents a negative resolution or negative knee-jerk reaction to the news. but all of which suggests a bullish resolution from a contrary perspective.

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

Monitor overnight Globex trading in the chaRTroom here.

Extending the rally Wednesday without delay had required gapping up, since Tuesday afternoon’s rally didn’t gain traction for its effort. The overnight drop foreclosed on that possibility, at best delaying it until late-afternoon.

A bigger rally could have followed a test of the morning’s bias-down target instead of just attacking it to within 3 ticks, and by triggering the morning’s no-bias signal instead of noN-bias. So, from the perspective of reverse-engineering, perhaps the traction handicap correctly prevented that.

So, rallying soon after the opening dip extended higher into the close, but remained under Tuesday’s highs. There is no bullish reason for any further backing-and-filling, let alone for any further delay to rallying aggressively. And since Wednesday’s rally didn’t gain traction, either, extending higher should begin by gapping up. Not gapping up would not be bullish.

[There was no post-market Wrap Wednesday.]

Monitor overnight Globex trading in the chaRTroom here.

The overnight drop extended a little post-open to come within 3 ticks of the 2082.50 bias-down target. Its reaction probed the 2089.00 bias-down signal up to 2091.25.

A good effort, but it didn’t last. And it didn’t extend.

Overlapping the 2089.00 bias-down signal at 10:15 invoked the grace period. It was touched again, literally 2 seconds after ending the 10:30 bar. I’m regarding this as a noN-bias — not a bias-down requiring fresh lows, nor a no-bias required to retest overnight highs.

In fact, another surge is attacking the post-open high to within 3 ticks. Back under 2087.50 would target fresh lows. Otherwise, this morning could rally back to unchanged.

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

Monitor overnight Globex trading in the chaRTroom here.

Was Monday’s drop from 2101.50 an unscheduled detour? Isolating it to the morning would have been perfectly acceptable within the pace and slope of characteristics likely for this recovery leg.

The afternoon’s 2086.00 lower low can be dismissed because it was reversed  back above the noon hour’s 2094.75 high. The morning’s 2096.25 bias-down signal was overlapped by 1 point. A last-minute plunge to 2090.50 is irrelevant, having originated AFTER coming within 3 minutes of the cash session close.

Greeting Wednesday’s open back at or above Tuesday morning’s 2101.50 high should not delay extending higher through the morning. The holiday’s 2093.75 Globex high requires a retest intraday, and the next higher attraction is 2116.00-2119.00. Otherwise, resuming Tuesday’s decline would all but require gapping down Wednesday under 2086.50.

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

Monitor overnight Globex trading in the chaRTroom here.

Yellen’s comment had triggered a plunge to 2089.75 whose oversold RSIs required a retest. Its retest launched a two-hour rally up to fresh highs. Post-close action barely nicked the lower-end of its potential to 2098.00-2099.00.

All “unfinished business above” is neutralized, but trend extremes rarely occur into or out of holiday weekends. We discussed more of the bigger picture during an expanded post-market Wrap (as there is NO review this weekend).

Please enjoy a safe and happy Memorial Day weekend.

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