Mid-day Update

So far, so bullish.

This morning’s recovery up to 2181.25 resistance ranged narrowly sideways into the noon hour. And halfway through it. The noon hour’s second half slid to 2176.00.

Noon hour action is not yet subject to the WedEX influence. Bias environment is. And since entering the bias environment, price has improved to test 2179.50.

That’s in-line with a bullish WedEX. But it’s only a bounce, and extending to fresh highs above 2181.25 would be helpful confirmation. Back under 2176.75 would start to signal a new downleg underway, which would not be appropriate for a bullish WedEX.

Failed rally instead of temporary dip.

Although opening strength up to 2181.25 did reverse down as expected, testing 2178.00 as support reacted up to fresh highs at 2184.25. That rally attempt was doomed to failure, since today’s open had not gapped up to overcome yesterday afternoon’s rally not gaining traction. Anyway, probing this morning’s 2182.50 bias-up signal after failing to trigger it was “no-bias trending,” also doomed to failure.

So far, that doom has been limited to retesting the open’s 2178.00 low as support.

Meanwhile, this afternoon’s 2178.50 bias-down signal has avoided triggering. It should define the next hour’s lower-end if retested, similar to this morning’s bias-up signal having defined the upper-end despite being probed by almost 2 points.

Yesterday afternoon’s rally doesn’t require extending higher today, even after the bias environment lapses. Backing-and-filling isn’t required to extend any lower, either. Limitation is the only requirement until the bias environments have lapsed.

FOMC Minutes just ahead.

This morning’s 2174.25 bias-down signal had put into play its 2168.00 bias-down target. Having hovered just above 2168.00 for so much of the bias environment, eventually testing it became likely also to visit 2166.00.

A 5-point drop finally broke the range, testing and retesting 2166.00.

Reacting up violated the drop’s bounce limit and then triggered an inflection point, extending already back up to 2174.25. Having been unfinished business below and this morning’s bias-down signal, and the independently calculated early sell signal, 2174.25 is a likely candidate for at least near-term resistance.

The noon hour’s recovery rally was a reaction to dovish comments from a Fed speaker. Now hawkish FOMC Minutes can more easily trigger a reaction down. Back under 2170.75 would target 2167.00.Absorbing less dovish FOMC comments could extend the recovery, triggered back above 2177.00, which is this afternoon’s bias-up target.

Gap down not yet extended.

Gapping down to this morning’s 2181.25 bias-down signal had extended immediately to touch 2177.00. Its first reaction up to 2182.50 has yet to be exceeded, despite the initial break lower having yet to extend. Regardless, the 2174.25 bias-down target became “unfinished business below.”

Ranging narrowly this morning was contained essentially between the resistance of the 2181.25 bias-down signal, and an inflection point at 2179.00 as support.

2179.00 has been broken, but not deeply enough to trigger this afternoon’s 2177.00 bias-down signal. Price is consolidating optimistically short of touching 2177.00.

Breaking under 2177.00 before the bias environment begins lapsing would be “no-bias trending” that requires being retraced before a deeper drop would be credible. Delaying the break or overlapping 2177.00 until then could trend down into the close.

Potential for bouncing instead can’t yet be dismissed. But the nearest buy indication of momentum reversing up wouldn’t be triggered under the 2183.00 area.

I WILL BE AWAY FROM SCREENS ALMOST ALL OF THE FINAL HOUR TODAY. MARKET WRAP WILL BEGIN EARLY AT 3:00 PM ET.

Gapping up to prior highs and extending higher through the open has not extended higher. Neither has it reversed down, not even as a corrective pullback.

Rather, the first hour’s test of its 2189.50 bias-up target began more than a 3-hour range around it. And it’s narrow, not even 2 points high.

Is it a bullish Flag continuation pattern? It’s possible, since it is forming entirely above all prior highs. The duration of its narrowness is disproportionate to the rally into it, so its first break higher would be suspicious until exceeding 2191.50, and its own 3-minute high.

Back under 2188.25 could target 2183.50 and then much lower. Of course, there’s no requirement to resolve today either way — but a 2-point range probably won’t persist.