Mid-day Update

Trending down through the noon hour might get push back.

The morning’s 2059.25 bias-down signal had quickly met its 2053.00 target. Several attempts to break lower all failed. The balance of the bias environment bounced to 2060.00 resistance.

Rallying through the noon hour would have been a great opportunity to compartmentalize this morning’s backing-and-filling. But the noon hour slid throughout, probing fresh lows down to 2051.25.

Persistent weakness hasn’t attracted much more selling pressure. The afternoon’s 2053.25 bias-down signal was still being overlapped at 1:20 and 1:30 to trigger noN-bias. The bias-down target isn’t in-play, and neither bias signal must define the range’s extreme.

Back above 2056.00 would give one more chance at an afternoon rally. An afternoon rally is critical to yesterday’s session-long rally ending the three-week old decline. Otherwise, exiting the afternoon bias environment at 2:30 under 2050.50 would all but require the next upleg to originate from lower levels.

Morning surge suggests bigger upleg coming.

Plunging this morning or at least breaking sharply was the only credible path down. And not only down, but to convert Friday’s retest of the prior Friday’s lows into extending the multi-week decline much lower.

Despite ranging narrowly since midnight Sunday, Monday’s open began recovering to and through this morning’s 2050.50 bias-up signal. Its 2056.00 bias-up target had room for noise above it to 2058.50, which was touched when the bias environment began lapsing at 11:30.

The noon hour was entered at session highs up to 2061.50. Holding 2056.00-2058.50 would have let the afternoon back-and-fill, but probably not do anything outright bearish. Not reacting down from 2056.00-2058.50 has left the door open to extending the rally this afternoon. And extending the rally this afternoon would likely be very aggressive.

Unless proved otherwise, upside momentum remains intact and the afternoon remains vulnerable to trending up steeply and substantially. Similar to the last two weeks’ Monday or Tuesday session-long rallies, it would be  likely to launch a larger multi-session rally back to the highs — in fact, the noon hour’s exit just touched 2062.50.

And like those last two attempts, it would be vulnerable to fail. But a credible downleg would begin before entering a timing window, and none yet has this afternoon.

Latest attack on yesterday’s lows was not rejected.

If this morning didn’t trend, then this afternoon was unlikely to only range. Much likelier was to produce the trend that the morning could have produced, regardless of direction. Ultimately, the direction would be dependent on yesterday’s lows being compartmentalized.

Not exactly yesterday’s lows, bu the structure at yesterday’s lows.

The overnight dip was recovered at the open to compartmentalize its probe into (and through) yesterday’s lows. A post-open dip was recovered into the 10:15 bias timing window to compartmentalize another probe. Even the morning’s bias environment probed the structure and recovered it before the bias environment began lapsing. Compartmentalized.

The noon hour didn’t get the memo.

Triggering late bias-down under 2054.25 has extended through its 2049.00 bias-down target. Last Friday’s 2045.00 lower prior highs is being probed by more than 1 point. Room for noise below it is 2042.00.

Exiting the bias environment back above 2047.00 would start signaling the downside momentum was lapsing, confirmed back above 2052.00. Back above 2056.00 would be pretty bullish, especially if maintained through the close. Exiting the bias environment under 2042.00 could meltdown into the weekend, which had been the less likely bearish scenario.

Predictable and productive trending remains intact.

This morning’s 2052.50 bias-down target was still being overlapped at the bias environment exit. A retracement to its 2058.00 bias-down signal is required. Often, the 10:15 bias timing window print is also retraced at 2064.00.

First things, first. Oversold RSIs at the 2048.50 low require its retest. That didn’t prevent bouncing to 2056.50, but now 2052.50 is being tested as support.

Also being tested is a sell signal at 2051.50. Not triggering it would make a higher bounce likelier. The bigger challenge is that this morning’s potentially bullish setup (session-long rally) had formed but wasn’t triggered, which should point down shrprly today.

Post-open surge returns to its lows.

Was this moring’s 2073.00 bias-down signal not rejected until 10:30 because the EIA report had inhibited price action? Possibly. It triggered a 5-point surge to 2078.00 where at least some hesitation had been likely.

But that surge was retraced entirely, probing 3 ticks under the overnight lows down to 2068.75.

Ranging narrowly for two hours has held 2073.00 as resistance. Now the noon hour is being exited and the afternoon’s bias timing window is just minutes away. Reaction to the 10-year auction is retesting the low.

It’s only a knee-jerk reaction down if 2071.50 and 2073.00 are recovered now. That’s still quite a bit short of the 2076.75 bias-up signal. A rejection of yesterday’s rally isn’t very likely today, but that doesn’t prohibit probing fresh session lows before recovering.