Mid-day Update

Open’s dip retraces. Somewhat.

It’s not at all surprising that today’s lower-volume session remains range bound. It’s impressive that this morning triggered bias-down, and that post-open action trended aggressively. But the 2493.25 bias-down target remains outstanding. And the aggressive trending was due more to thin volume than to wide participation.

That latter point is why so much of the post-open drop was retraced into the morning’s bias environment exit. But the noon hour mostly ranged narrowly. A blip-down tried to trigger a sell signal under 2501.00, but only by 1-2 ticks before recovering to its 2503.00 origin.

This afternoon is now triggering no-bias, not even threatening either bias signal. There is no active sponsorship for trending either way, but beware of any knee-jerk reaction to news headlnies.

FOMC events dead ahead.

The open’s tests of fresh highs and of the morning’s 2507.00 bias-up signal held, putting into play an offsetting test of the morning’s 2498.00 bias-down signal. It was attacked down to 2502.50, making it “unfinished business below.”

Meanwhile, the relatively narrow range persists as this afternoon’s FOMC events get nearer. Probing in either direction is possible. Probing in both directions is possible, too. Either or both probe could reach double-digits before reversing, if reversing.

And the reaction to the policy statement could be undone during Yellen’s Q&A. Especially if initial trending were to probe either end of this afternoon’s 2498.00-2507.00 no-bias environment.

Still in the range.

This morning’s bias environment pierced the open’s 2501.50 low by 1 tick in a noN-bias environment. No attraction above was in-play. But the opportunity to extend down was displaced by  an hour-long 4-1/2 point rally. The open’s 2505.00 print was overlapped by 3 ticks going into the noon hour.

Recovery? The open’s 2505.00 print was still being overlapped by 3 ticks well into the noon hour. And that reacted down into the afternoon bias environment.

All of which continues to develop within yesterday’s range. Not that yesterday’s range won’t be retested — hovering pessimistically short of yesterday’s 2506.00 high all but requires actually probing it. So, the question is whether its test will hold, and reverse price back down.

Back under 2503.25 would start to undermine there being a fresh high. That’s the “but” in “All but required.” That’s during the bias environment or coming out of it. Reversing down would be possible at any point today, although delaying a reversal down would make it less substantial.

How passive can passively bias be?

This morning’s no-bias environment probed fresh highs up to 2496.75 high. Testing this morning’s 2496.00 bias-up signal defined the window’s upper-end. Price action since then has been contained within a narrow 2-point range down to 2494.25. Now the afternoon’s no-bias has triggered.

Friday afternoon’s are more notorious for no action than for suddenly trending when there hasn’t been any. Absent another missile threat, the session’s only remaining potential influence is the passively bullish WedEX. Its only qualification is to recover any dips, and not necessarily to trend up.

Meanwhile, the no-bias environment should be contained within its 2492.25 and 2497.50 bias signals. Until the bias environment begins lapsing at 2:30, or that comes within view 10-15 minutes earlier, which would be free to trend either way.

Stuck at unchanged without new news.

If not for the pre-open news, would this morning have only extended the narrow overnight range? Its plunge was recovered entirely back into the overnight range. And then momentarily higher to 2496.25.

But returning to positive territory and reversing into positive territory seem to be two different things. Sideways ranging resumed before the morning’s bias environment began lapsing. It extended through the noon hour, and now in to the afternoon bias environment.

Will more trending today require another missile rumor? An actual launch? Regardless, extending higher is difficult with this morning’s missile threat hanging over the market’s head.

Retesting the 2489.00 post-open low would likely also test the 2487.50 pre-open low. Testing either would be the last opportunity to break lower. In other words, holding a retest of this morning’s lows would form a base to resume the rally.

Otherwise, narrow ranging or a shallow dip may define the balance of the session. Neither of which would offer a signal.