Market Wrap

One piece of “unfinished business above” remains outstanding at 2454.00. It was a bias-up target that triggered that afternoon. It’s likely to be retested soon after the current pullback ends. But there’s no requirement for the pullback to end.

Meanwhile, Tuesday’s plunge down to 2416.50 only touched a prior low. That’s optimistically short of what constitutes an optimal test, let alone thorough. Especially when the next lower objective is only 1 points lower, or 2 points when including its room for noise that is likely to be tested.

There’s some potential for “lower prior highs” at 2412.00 to formulate a bottom, which would launch a retest of the highs. Otherwise, probing any lower would next target 2399.00.

Tuesday afternoon’s bias environment high printed very early at 2431.50. A lower high printed at 2427.50 as the bias environment began lapsing. Having trended down into the close, just recovering one prior high at Wednesday’s open could form a “session-long rally.” Optimally, the setup would gap up above the entire bias environment. Likely, the decline persists.

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

Monitor overnight Globex trading in the chaRTroom here.

A funny thing happened on the way to new highs…

No signal or setup can prevent against counter-trending against it. We can only identify levels that shouldn’t break otherwise, and perhaps play the break’s counter-trending. And the original pattern’s levels remain relevant during the reversal.

Rarely does Monday’s opening setup not extend higher in the morning and into the afternoon. Whatever the catalyst of the mid-morning plunge, the open’s context was not invalidated. Its relevant price levels like the morning’s 2438.00 bias-up signal remained influential. And the opening gap’s recovery and resumption remain possible so long as Tuesday’s open doesn’t maintain a gap down.

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

Monitor overnight Globex trading in the chaRTroom here.

Chipping away further at the 2430.50 back down to last Friday’s close remained vulnerable to breaking lower. But perhaps this Friday’s opening probe under it developed too quickly to attract sponsorship.

Amazingly, an 11-point rally up to 2439.00 attracted more sellers than did the open’s 5-point dip. The afternoon bias environment exit was already slipping, and then it stumbled down to 2431.00. Despite stopping optimistically short, that still qualifies as another test last Friday’s 2430.50 close.

2430.50 has been so thoroughly tested as support that at least some obligatory probe under it is likely, if not a new downleg to the 2415.00 area. Rallying prior to that would seem very suspicious. Especially a rally that doesn’t start by gapping up above Friday afternoon’s 2438.75 highs, since Friday’s buyers gained no traction.

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

I’ll send the Saturday Review link in the morning, well before its 9:30 ET start time.

Thursday’s opening checkpoints indicated a lack of sponsorship, at least for the morning. Actually, that didn’t prevent the open’s narrow range from launching a morning surge. But the sure was contained by the bias-up signal.

That was almost the session’s only semblance of sponsorship, as the afternoon settled into its own narrow range. Thursday’s other trending was during the position-squaring window. Dropping under the afternoon’s 2436.00 sell signal retraced the morning’s surge and closed negative.

The late origin of the afternoon’s drop does undermine its sponsorship as being weak-handed. But the setup is bearish because its retracement undermines the sponsorship of the morning surge’s rally. Unless Friday’s open were gapping up above Thursday afternoon’s 2438.50 high to trigger a “session-long rally,” resuming the decline to the 2415.00 area is likely.

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

Monitor overnight Globex trading in the chaRTroom here.

Did Wednesday’s buyers succeed where Tuesday’s buyers had failed? Tuesday’s late low filled the gap down to last Wednesday’s 2435.25 close. It was tested late and not rejected. Wednesday filled the gap back down to Friday’s 2430.50 close. It was done overnight, late-morning, and again in the afternoon. That’s much more time to have broken lower, if that were the market’s intent. Right?

One element still missing is the actual rejection. Buyers must produce a close back above a prior high to indicate that new sponsorship has arrived. Any shallower recovery attempt has succeeded only to chip away at support.

Thursday’s buyers could succeed where Wednesday’s buyers failed. Gapping up above Wednesday morning’s 2440.00 high could serve by proxy as if sponsorship had arrived already Wednesday afternoon. Otherwise, the pattern is vulnerable to already greeting the open probing fresh lows.

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

Monitor overnight Globex trading in the chaRTroom here.