Mid-day Update

Morning rally fulfills its objective. Noon hour probing higher.

This morning’s 2263.00 bias-down signal did not trigger. Its grace period triggered late no-bias. It was by only a 2-tick margin, and not a new post-open high. So, it wasn’t optimal, but it was no-bias, and it put into play an offsetting test of the 2271.50 bias-up signal. It was met before noon.

So, what about the bearish open? Despite being productive, dropping 5 points to touch the overnight low, it didn’t extend down, and didn’t prevent rallying. It also didn’t leave unfinished business below. But it wasn’t rejected. We’ll come back to that.

2271.50 was still being tested at noon. So was the peak of yesterday morning’s bounce. And the gap back up to Friday’s close was filled, also holding at noon. Entering the noon hour any higher would have been bullish. An attraction above at 2275.50 is helping to attract price higher — it’s not in-play, but it’s the next higher objective if the noon hour isn’t exited back under the last relative low.

The last relative low is 2269.50, and its break would start to signal a reversal down. Its objective would be to retest this morning’s low. Its structural weakness already suggests the rally from it won’t last. New highs won’t negate the structural weakness.

Post-open bounce stops short. And then stops.

Gapping down to 2268.00 and extended down to 2263.50 was recovered during the morning bias environment back up to 2270.25. That’s 1 points short of filling the gap back up to Friday’s close. So, pessimistically short.

The noon hour and the afternoon bias environment have ranged back down to 2266.00. Stuck in negative territory, but not extending down. So, ineffectual pessimism.

Each is potentially bullish from a contrarian perspective. Potentially, because it must be exploited within certain time frames, like a timing window’s exit. A timing window is within view of exiting now, and fresh afternoon lows have touched 2264.50.

Any deeper through the bottom of the hour could trend down into Wednesday morning. Back above 2267.75 by the top of the hour would more likely reverse into positive territory, targeting at least this morning’s “unfinished business above” at 2275.50.

Probing new highs.

The bias environment’s 61.8% retracement back down to the 2258.25 low did quickly recover back up to the 2266.00 bias-up signal. Hovering there until coming within view of the bias environment exit — and only until then — suddenly broke higher to the 2271.25 bias-up target.

And then higher. The 2273.00 prior high was tested just before noon. The noon hour touched 2277.00. The 2274.25 bias-up signal did trigger, but it was invalidated by breaking under it at 1:30 down to 2273.00. That hasn’t prevented a bounce back up to 2276.25.

Back under 2273.50 would start to signal this bounce off of 2273.00 is only obligatory. If today’s rally is going to avoid a new trend high close, then this afternoon’s bias environment should start the process. Regardless of its resolution, there is no unfinished business above.

Afternoon rally undermined by Crude Oil drop.

The gap back up to yesterday’s 2264.50 close was only filled this morning, never probed. That wasn’t the differential to rallying later — sellers had already failed to retake control when that was required. But the likelihood for an afternoon rally would have been greater without sellers even trying to retake control again. Which they did.

Reaction to this morning’s EIA release sent Crude Oil down. The market fell with it from 2263.00 to 2256.50. Probing lower down to 2254.00 was retraced entirely through the noon hour back up to 2256.50.

The 2260.50 bias-up signal didn’t trigger, despite invoking the grace period. Hovering at it until the bias environment lapses would be vulnerable to then breaking higher, and essentially fulfilling the bias-up target.

Exiting the bias environment back under 2256.50 and lower would confirm what exiting the bias environment under the morning’s bias-down signal had suggested — undermining the afternoon rally scenario and all but reversing momentum down.

Hovering through the highs, into and out of the noon hour.

The open had surged from 2256.00 up to almost 2264.00. That was the opening 5 minutes. That was corrected down to 2257.50 through the balance of the hour. The balance of the morning retraced the opening high.

And the noon hour probed it by 1 point. Its fresh high was isolated to the noon hour, but only shallowly. Rejecting a more decisive rally effort, or a more decisive rejection, would have suggested the weakest-handed buyers were done. That would have been bearish. But that was avoided.

No-bias triggered, but back under 2261.00 would start to signal a deeper pullback underway. Meanwhile, the rally is free to resume, and to at least test this afternoon’s 2265.75 bias-up signal until the bias environment begins lapsing.