Market Wrap

Wednesday’s opening Globex-flip setup was productive. Exiting the open back under the 2813.25 earlier Globex low had isolated the overnight probe above Tuesday’s highs. The setup’s influence lasts either for the morning, or through the following morning. It lasted only through the morning, producing a drop to 2783.25.

The bias environment exit had retraced 61.8% of the post-open drop back up to 2801.50. That was extended to fresh session highs at 2819.50. Literally anything higher would have started a domino effect of testing the 2819.50-2823.00 upper-end, and breaking the 2824.00 overnight highs up to 2838.00. But a dip back down to 2800.00 avoided the dominoes, and the balance of the session ranged choppily sideways.

The morning’s low stopped optimistically short of touching the multi-session Ascending Triangle whose breakout Tuesday is likely to fail. The low left outstanding oversold RSIs that require a retest. That’s the market’s next objective, likely to extend lower, unless overnight action has returned to the dominoes.

Details and other markets coverage are discussed in the post-market Wrap recording here.
Monitor overnight Globex trading in the chaRTroom here.

Monday’s late-afternoon slide had broken under the uptrending support of an Ascending Triangle pattern we were tracking. The relentless 28-point overnight rally greeted Tuesday’s open back at the broken uptrending support, and extended higher to reject its interim break.

The open had one chance to reject the overnight rally, but the opening 15 minutes of volatility held the 2773.00 open. Extending higher through that window would have been optimal, but hovering pessimistically short of Monday’s 2779.00 highs was bullish enough.

Apparently. The balance of the session trended up relentlessly, adding 36 points to 2816.00. Even a very last-minute pullback to 2808.00 was recovered through the futures close to 2919.00. That’s 64 points above the overnight low.

That’s also the lower-end of 2919.00-2923.00 resistance from a Running Correction that had formed during last Wednesday afternoon’s decline. The next higher resistance is 2838.00 “higher prior lows” from that morning’s consolidation. One or both is likely to be met if Wednesday’s open isn’t greeted by already reversing back under Tuesday afternoon’s 2808.00 bias environment highs.

Details and other markets coverage are discussed in the post-market Wrap recording here.
Monitor overnight Globex trading in the chaRTroom here.

Suddenly, in the midst of mutli-session collapse, Friday produced an “inside day.” It session was contained entirely within Thursday’s range. So, Friday’s range was already narrower than any one of the declining sessions that preceded it.

Yet, Monday produce another inside day, even narrower than Friday.

Inside days don’t offer much predictive value, especially not without trending intraday. And Monday didn’t trend intraday. Its initial dip held the morning’s 2751.75 bias-down target. Its session highs repeatedly attacked and tested 2777.00 resistance. Dropping from the range’s upper-end to its lower-end through the close got to 2749.00, but not until after the close when its test was irrelevant.

An Ascending Triangle had begun forming that could still break higher. But breaking higher at this stage would be suspicious without actually gapping up above the pattern’s upper-end. Extending down without delay to at least retest Thursday’s 2712.00 low is no less likely.

Details and other markets coverage are discussed in the post-market Wrap recording here.
Monitor overnight Globex trading in the chaRTroom here.

Did it, or didn’t it. Will it or won’t it. Thursday’s close under 2749.00 wasn’t repeated Friday. But neither was it rejected. Bouncing Thursday night was retraced to retest 2749.00 Friday, and the interim high held. So, the downtrend remains intact.

More so, a lot of buying pressure was expended without gaining traction for the effort. Not an arbitrary amount, but exactly enough to retest the open’s 2779.25 high to within 2-3 ticks. Which would be bearish, had Friday probed a new low. But the burden of proof remains on buyers to gap up Monday, or else sellers get another intraday downleg.

Meanwhile, oversold RSIs at Thursday’s 2912.25 low still require a retest. And now Friday’s bounce from within 2-3 ticks of Thursday’s 2731.75 cash session close seems somewhat obligatory. So, a lot of buying pressure was expended to try avoiding plenty of attractions below. Not already rallying at Monday’s open would likely be because sellers are back in force for the morning.

Details and other markets coverage are discussed in the post-market Wrap recording here.
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If you liked the last two days…

Thursday ultimately closed under 2749.00. Being “lower prior highs,” it was the decline’s next lower objective. Regardless of bouncing from its overnight tests and late morning test, or even from its afternoon test, only closing back above it would indicate its support had held.

It didn’t.

Interestingly, the next lower objective under 2749.00 is 2721.00 with room for noise under it down to 2712.00. The afternoon’s 2712.25 low reacted up 54 points to 2766.00. It reacted back down to 2727.00, retracing the session’s last surge that had been triggered by a China headline.

Oversold RSIs already make the 2712.25 low’s retest likely. Closing under 2749.00 makes the low’s retest less likely to hold. Closing above 2749.00 still would have retested 2712.25, but from a position of strength. Regardless, oversold RSIs can be neutralized overnight, so that opening back above 2749.00 could form an Isolation setup.

Otherwise, retesting 2712.25 post-open would be likelier to break under 2709.00, which opens the floodgates. So, if you liked the last two days, and a retest of Thursday’s low on Friday or overnight isn’t immediately rejected, then you’re going to love the likely meltdown that follows into and out of the weekend.

Details and other markets coverage are discussed in the post-market Wrap recording here.
Monitor overnight Globex trading in the chaRTroom here.