Mid-day Update

REMINDER: I’m away from the screens when the afternoon bias environment begins lapsing at 2:30 ET. Daily Spot will be today’s last post. There will be no Market Wrap or Saturday Review.

3-4 recovery attempts have interrupted several probes of fresh or otherwise relevant lows. The 2690.00 gap down reacted up 7 points. Its reaction down to 2683.50 reaction up 10 points. The bias environment’s exit at 2681.00-2682.00 reacted up 10 points, too.

Pretty big reactions up, but has the last one finally trapped sellers? Actually, the last reaction up has extended to 14 points, testing this afternoon’s 2693.75 bias-up signal up to 2695.00. It was still being tested at both 1:20 and 1:30 to trigger noN-bias.

No requirement to hold as resistance, although back under 2690.00 would start to signal another downleg may be underway. And no requirement to meet its bias-up target, although back above 2695.00 would get a benefit of the doubt for extending higher, anyway.

This being a Friday, isolating failed trending attempts to the morning’s timing windows can form a session bottom. Recovering 2688.00-2690.00 into the noon hour would have isolated this morning’s fresh lows, but 2688.00-2690.00 was still being tested at noon. Exiting the noon hour higher could have been bullish, but it failed to trigger bias-up. The decline isn’t required to resume today, but sellers are NOT marginalized.

Snapped stretch trying to snap back.

“Lower prior highs” at 2708.00-2709.00 defined the open, while being probed down to 2705.25. And it could have defined a bottom. But its reaction up to 2718.50 came too quickly to attract more reinforcements than inhibit them. And a China trade headline transformed an otherwise healthy pullback into resuming the decline.

The next lower objective at 2688.00-2690.00 was tested down to 2687.25 as the bias environment lapsed. The noon hour’s lower lows at 2685.50 were recovered enough and in time to avoid triggering the afternoon’s 2688.00 bias-down signal. Its reactions held tests of the 2695.50 bias-up signal. This is a no-bias environment.

No-bias trending just touched 2700.00, requiring that 2695.50 be retraced. No-bias trending has room up to 2705.00 without even threatening to reverse momentum up. Meanwhile, back under 2693.50 could resume the decline, or at least probe fresh session lows.

Volatility has gone into hiding.

The post-open slide that triggered bias-down probed the 2724.50 overnight low on the way to touching yesterday’s 2722.25 low. But no lower. Probing fresh lows during the 10:15-10:30 window made a recovery very unlikely.

A recovery, but not necessarily a retracement. In fact, the post-open slide was retraced almost entirely to within 1 point of its 2736.50 high. And “unfinished business” was left outstanding at this morning’s 2720.25 bias-down target.

Dips since the recovery have repeatedly tested 2726.50 as support. But there are no indications of trending, especially as this afternoon’s no-bias signal is triggered without testing either bias signal. Be careful in this environment not to force a trade.

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Morning’s target launches steep reversal down.

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Still overlapping this morning’s 2730.00 bias-up target prevented renewing its signal. It was still a bias-up environment, and its 2737.00 renewed bias-up target was met anyway. And touching it at the morning’s high reacted back down to 2730.00 as the bias environment began lapsing.

The noon hour broke lower, coming to within 1 tick of this afternoon’s 2722.00 bias-down target. The low’s oversold RSIs formed as the noon hour was lapsing, so it doesn’t require a retest. But back under 2724.75 would start to signal the low’s retest underway. It’s still a bias-down environment, so perhaps deeper.

Meanwhile, the open’s 2728.00 gap will want to be retested after having retraced back into a prior session’s range. The reaction up from attacking 2722.00 has come to within 1-2 points. Neutralizing its attraction and then triggering a sell signal would be more vulnerable to extending down further.

Now probing Friday morning’s highs.

The open’s lower and lower lows ultimately held a test of this morning’s 2698.75 bias-down signal. Its offsetting test of the 2710.25 bias-up signal was fulfilled as the bias environment began lapsing. Price held up through the noon hour, extending flat-to-higher. Now Friday morning’s highs are being probed up to 2717.25.

This afternoon’s 2713.00 bias-up signal has triggered, putting into play its 2719.00 bias-up target. Friday morning’s “unfinished business” at 2719.25 would be neutralized there, too.

Nothing requires meeting either target today, or extending even high if met. RSIs are overbought at the high, so a reaction down would require being recovered. A reaction has room to 2711.00 before suggesting a more substantial detour down is underway.