Mid-day Update

Hovering just under session highs.

2290.00 was probed this morning by almost 4 points attacking 2294.00. A reaction down attacked 2289.00. Exiting the bias environment above 2290.00 all but ensures that new highs are in-play.

We already knew before yesterday’s close that the ranging was not accumulative, so rallying would require gapping up. Gapping up in reaction to new this morning suggests the rally is sponsored by weak hands. None of which prevents actually probing higher, potentially to 2327.00.

Meanwhile, hovering pessimistically short of the morning’s high is potentially bullish from a contrarian perspective. But fluctuating narrowly around this afternoon’s 2292.25 bias-up signal hasn’t made the rally any likelier to resume, only that at least a probe of new highs develops.

Morning’s rally may have defined the range’s upper-end.

REMINDER: I AM UNAVAILABLE SINCE NOON TODAY, FOR THE BALANCE OF THE SESSION. THERE WILL BE NO MARKET WRAP.

Not bad for a half-day’s work. Or, half-morning, actually. Testing the 2278.75 bias-up signal was the predictable outcomeof this morning’s setup. That was fulfilled, by a surge through 2275.00 to 2279.75. Its reaction down to 2275.00 is trying to reverse momentum back down.

Regardless, overbought RSIs at 2279.75 require its eventual retest. That might enable extending the rally this afternoon, but the difficulty with any trending is the usual anxiousness ahead of Friday morning’s Employment Situation report.

Reversing back down to 2271.00 can’t be dismissed. Neither can extending that back toward the overnight range’s lower-end around 2266.00. Fresh highs above 2281.00 would have potential to last Thursday and Friday’s 2287.00-2289.00 higher prior lows.

FOMC news and its reaction on their way.

This morning’s rejection of the bias-up signal wasn’t decisive enough to rely on an offsetting test of the bias-down target. Testing only the 2270.75 bias-down signal down to 2268.25 may have satisfied selling pressure. May have.

Meanwhile, this afternoon’s 2275.00 bias-up signal was touched but not triggered. As much buying pressure as could be expended without reversing the trend up was expended. Not a position of strength.

Greeting the 2:00 FOMC news from under 2270.75 would be likely to extend down. Perhaps this morning’s 2265.25 bias-down target is met, after all — and broken on the way to testing 2248.50.

A bullish reaction would be likelier if the news were greeted from above 2277.00-2278.50. Regardless, note that earnings and tomorrow’s BOE statement are still going to inhibit sponsorship.

Unfinished business below is neutralized.

Stopping optimistically 3 ticks short from touching yesterday’s 2263.50 low did not satisfy it. It was an actual print, and not just a calculable objective.

Reacting up to 2269.75 was retraced almost entirely, also stopping optimistically short of touching the 2264.00 low. The next bounce resolved down to a fresh low at 2262.25, satisfying the objective.

Reacting up again attacked the 2268.75 bias-up signal during the noon hour held. This is a no-bias environment. Probing a little higher would have been allowable, but instead another dip is attacking 2264.00. There’s room down to the 2260.50 bias-down signal during the no-bias environment.

Trending gets more difficult as tomorrow’s FOMC statement approaches. But another downleg would be allowable after the bias environment begins lapsing. Its break would have potential to test 2248.50.  Back above 2268.75 would target a retest of the 2276.75 overnight highs.

REMINDER: MARKET WRAP BEGINS AT 3:33pm ET.

This morning’s drop ultimately touched 2263.25. This allowed room for a corrective bounce up to 2271.00, which was touched before noon. It has yet to be exceeded, which would essentially target 2278.00.

And there is no requirement to bounce any higher.

The only requirement to bouncing higher is to start bouncing today. But sideways ranging through the noon hour has avoided extending higher. And despite this afternoon’s no-bias environment having room up to its 2275.75 bias-up signal, its 2266.00 bias-down signal is being attacked.

Oversold RSIs at the 2263.25 low require its retest, eventually. That would be the likely objective if 2266.00 were probed during the no-bias environment. It would be an objective if probed after the bias environment begins lapsing, but could also give way to a new downleg that resumes the decline.

Meanwhile, back above 2270.50 would start to signal a bigger bounce underway, regardless of the delay.  And delaying the recovery — even if oversold RSIs were left outstanding — could still produce new highs.