Mid-day Update

Post-open rally retraces the opening lows, almost.

The open’s test of 2704.00 wasn’t recovered through 9:45, creating a position of weakness. So, despite rallying to attack 2719.00, sliding into and out of the noon hour has returned to 2704.00. But only to 2704.00.

2704.00 is this afternoon’s bias-down signal, and it didn’t trigger. Not even after invoking the grace period. And now its reaction has bounced to 2711.00, with room up to the afternoon’s 2716.50 bias-up signal.

Back under 2707.50 would signal the decline is resuming, although 2704.00 should hold its test until the window comes within view of lapsing. Then 2696.00 and 2692.00 would be in-play.

Morning rally hasn’t extended.

A funny thing happened since this morning’s rally up to 2745.50… Nothing.

That is, no higher highs, not during the noon hour, or thus far into the afternoon bias environment. The latter hasn’t even breached the former. Sorry, the noon hour’s 2743.00 lower high hasn’t been retested.

But that’s just one nothing. The other nothing is no lower lows. The noon hour’s 2735.00 low barely attacked the post-open low.

So, the rally’s sponsorship is expending all of its energy just to avoid reversing. Which isn’t very decisive any other day. But today is Friday, when fresh highs during the afternoon bias environment tend to extend through the close. Not exploiting that opportunity is almost tantamount to being a sell signal.

Much more tantamount to being a sell signal would be exiting the bias environment by breaking under its 2736.75 bias-down signal. It’s being tested now, and its break needs just a little more delay to avoid being no-bias trending.

Failed pre-open dip not reversing.

The late overnight dip was at least likely to retest the overnight range before being able to extend down, if it even extended down. The overnight range has been retested, and the break has not extended down. In fact, the overnight range’s retest up to 2714.00 is being attacked now up to 2713.25. And there’s room up to 2715.00 during this no-bias environment.

Back under 2707.00 would start to signal another break lower trying to form. That signal would be triggered under 2711.00 if 2715.00 were tested first. Regardless, the no-bias environment’s lower-end should be defined by its 2704.25 bias-down signal if tested prematurely.

I think the market wants a fresh high up to 2715.00 before reversing down. Regardless, still not actually rallying — not yet exploiting the pre-open false break — is similar to last night’s narrow ranging in positive territory. It’s just more “ineffectual optimism” that refuels sellers, and not accumulation. Only recovering 2715.00-2718.00 would start to suggest otherwise.

Pre-open recovery gets retraced entirely.

The overnight probe under yesterday’s lows was isolated thanks to a headline that diminished the US-China trade war. That produced an Isolation setup whose reward was at least to retest yesterday’s 2735.25 high. The recovery ultimately extended up to 2748.00, testing room for noise above Monday’s opening 2744.50 gap.

The market has reversed down since then almost relentlessly. This morning’s 2729.00 bias-up signal was attacked as support, 19 points off of the high. Which was overshadowed by the 26-point drop to attack 2715.00.

That’s 33 points under this morning’s high, and 10 points above the overnight low. Any fresh low will likely have resumed the overnight decline, which had itself tried resuming Monday morning’s decline. Support at 2711.00 would be the last opportunity to recover from fresh lows.

Meanwhile, the 2715.25 low occurred at the 1:20 bias timing window. So, exiting the bias environment back above its 2724.25 bias-down target could end the decline. For today.

Squeaking higher to the next resistance.

This morning’s 2728.25 bias-up target held the overnight high, and the post-open highs. Probing it momentarily by 2 points reversed down 13 points to fresh post-open lows. So, 2728.25 is kind of relevant.

2728.25 is also this afternoon’s bias-up signal. And testing it throughout the noon hour broke higher. But its 2735.50 bias-up target was being tested at the 1:20 bias timing window. Similar to this morning, which was holding its 2728.25 bias-up target.

Neither setup required holding, let alone reversing down. This morning’s setup did reverse down, but only temporarily. Reversing down this afternoon — back under 2730.25 would start to signal a reversal — would likely produce fresh session lows, perhaps even under yesterday’s lows.

Otherwise, probing fresh highs before late afternoon could extend higher, despite buyers having failed to gain traction yesterday. But there’s no requirement to extend higher, and current fresh session highs remain vulnerable to reversing down.