Market Wrap

Dropping back down to Tuesday’s lows overnight had all but ensured that Wednesday’s open wouldn’t gap up. And that was the only way to resume rallying immediately since buyers hadn’t gained traction. More so, Tuesday’s lows — and the overnight retests — had narrowly avoided fulfilling their potential down to 2884.50 or 2880.25. But Wednesday’s first hour took care of that, collapsing down to 2877.50.

Oversold RSIs were left outstanding at Wednesday’s low, requiring its eventual retest. That didn’t prevent a couple of higher lows from forming an Ascending Triangle. Its breakout triggered the afternoon’s 2888.75 bias-up signal, but stopped 2 points short of its 2995.00 bias-up target. That’s now unfinished business above since Wednesday afternoon only ranged flat-to-lower back down to within 1 tick of 2884.50.

Closing at or around 2888.00-2889.00 isn’t decisive enough to assume whether the next test is of 2877.50 below or of 2995.00 above. But testing the lower objective first — probably down to 2875.00 — would tell us the weakness since last week has probably been defensive posturing ahead of Friday’s payrolls.

There was no Market Wrap today due to travel.
Monitor overnight Globex trading in the chaRTroom here.

REMINDER: I’m traveling this week, and will have a staggered intraday schedule after the Market Tour and opening hour…

Tuesday afternoon’s rally from its 2885.50 low got to 2889.00, yet still remained in negative territory. Exiting the bias environment above the noon hour’s high could have gained traction by extending higher into the final hour, but didn’t. Even the 3:10-3:20 proxy window failed to exploit the opportunity to confirm upside traction.

None of which points down Wednesday. But rallying without delay won’t be credible without gapping up above a relevant resistance. Tuesday morning’s 2901.00 high would be a start, but less than optimal.

Stopping 1 point short of touching the next lower objective at 2884.50 wasn’t a deal killer for launching a credible rally. But not yet launching a credible rally does suggest 2884.50 will be better tested, and probably down to 2880.25, without gapping up sufficiently Wednesday morning.

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

REMINDER: I’m traveling next week, and will have a staggered intraday schedule after the Market Tour and opening hour.

Well, that was interesting. And useful, as a reminder of the difference between context and timing. The context was an overnight range at Thursday’s lows, showing no interest in rejecting Thursday afternoon’s plunge. Lower lows were likely, probably down to unfinished business below at 2892.25.

But the open bounced, at least enough to probe above the 2898.25 bias-down signal. And then enough to trigger a buy signal. And then enough to fulfill the bias objective, an offsetting test of the 2907.50 bias-up signal.

And in time to invoke the grace period. Which held the bias-up signal, putting into play an offsetting test of its bias-down signal… back down to 2898.25. Which was probed to fresh lows, including 2892.25, as the contextual clues had suggested.

Such is the volatility vulnerability of thinning volume. It’s a little surprising not have extending deeper to 2884.50 or 2880.25 compensating for the delay. Its test clearly wasn’t necessary to allow Friday’s late rally up to 2906.00 as Canada’s trade negotiator held her press conference. So, the new week will begin with a struggle between an attraction below, and unfinished business above at 2918.00.

Details and other markets coverage are discussed in the post-market Wrap recording here.
NO SATURDAY REVIEW THIS WEEKEND… ENJOY THE LABOR DAY HOLIDAY!

The recent tradition of morning trending into afternoon ranging was reversed Thursday. Gapping down ranged choppily sideways, and an afternoon retest of the morning’s high reacted down sharply.

Granted, the afternoon’s plunge was a headline reaction. And the morning’s bias window exit was probing fresh session lows. But sellers gained traction for their efforts, exiting the afternoon bias window and entering the final hour under their prior timing window’s lows.

Nevertheless, “unfinished business” was left outstanding above at the afternoon’s 2818.00 bias-up target. Which would be an attraction, especially if Friday’s open is gapping up above Thursday afternoon’s 2913.00 high, which is definitely possible if Friday isn’t extending Thursday’s drop to unfinished business below at 2892.25.

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

Wednesday was the fourth consecutive session for the morning to contain trending, trending that essentially defined the morning. Its 2916.00 high was retested during the noon hour but not broken.

An afternoon dip to almost 2911.00 was recovered to probe fresh highs, different from the prior four consecutive sessions whose afternoons only ranged sideways. Nevertheless, Wednesday was the fifth consecutive session to close back within the morning/noon hour extreme.

Trending sharply to fresh highs has been fulfilling expectations for the ultimate high’s character. Closing above the 2909.00 objective has put into play 2925.50 and potentially also 2930.00. Fulfilling either or just reversing down could back-and-fill 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.