Mid-day Update

Retesting the open’s lows.

No-bias triggered this morning after already having come within 3 ticks of the 2345.50 bias-up signal. That’s close enough not to become “unfinished business below” if not actually touched. It wasn’t.

Meanwhile, breaking lower would have potential to at least 2337.00. A break lower did begin soon after the bias environment began lapsing. Its 2337.00 minimum objective was tested during the noon hour. And now probing more than 2 points lower is threatening the next lower objective at 2333.00.

This is not a bias environment, so trending isn’t restrained. The only restraint is this being the afternoon prior to a three-day holiday weekend. That timing’s difficulty in attracting new sponsorship is almost offset by the proximity to prior lows.

We don’t know with a 100% degree of certainty that a durable downleg is not underway, or that the decline will end today at whatever price. Even if we did, fresh lows to 2327.25 would remain possible. And even the most bullish scenario might not avoid that without triggering this afternoon’s 2338.25 bias-up signal.

Creating more “unfinished business above.”

The open’s congestion held the 2344.25 bias-down signal’s test to trigger late no-bias, putting into play an offsetting test of the 2353.50 bias-up signal. So, upleg, right? No, a downleg.

A rogue downleg? The range broke well after 10:30, making it no-bias trending that required eventually retesting 2344.25. Despite the drop extending to the morning’s 2338.00 bias-down target — which was pierced by only 2 ticks — yesterday’s 2340.00 “lower prior highs” held as support. Now their reaction up has tested 2344.25, along with the 2346.00 10:15 print.

2353.50 can be added to the list of unfinished business above (along with 2352.50 and 2354.75). So, now this afternoon’s 2343.50 bias-up signal can be revisited below. Neutralizing its attraction would allow an afternoon rally. Perhaps even a full-throated recovery.

The impending three-day holiday weekend makes trending to a new extreme difficult. But not impossible, especially since we’re already at the extreme. Exiting the bias environment under 2342.00 could find the close sharply lower.

Much of morning’s drop already recovered. Or corrected.

The timing of this morning’s downlegs resemble yesterday, still coinciding with negative headlines. Today’s aren’t recovering before resolving down, so recovering them would be done by one comprehensive upleg — if done, at all. The minimum objective would be 2349.00.

2349.00 is pretty far removed from the morning’s 2333.25 low. The bias environment exit was just 3 points short of the 2343.50 level whose recovery could have undermined sellers already. Too late for that, now 2349.00 is required.

So, undermining sellers now requires a more substantial move. Considering the time limit, that move will need to be steep. In fact, the noon hour just produced a 7 points surge to 2345.00. And it has added another 6 ticks. The 2349.00 objective is no longer so much further away.

This being the noon hour, this might be only a temporary corrective bounce. Triggering the 2343.00 bias-up signal would help to undermine sellers. But entering or exiting the bias environment above its 2349.50 bias-up target would be optimal.

If weak-handed selling absorbed, then strong-handed buying should begin.

Monday morning’s pullback fulfilled its 2351.50 potential. And that was just during the morning. The origin of the move and its timing suggested its sponsorship was weak-handed. That didn’t prevent probing a little deeper to 2347.50 as the noon hour began. But its timing also suggested weak-handed sponsorship.

Suggesting weak-handed sponsorship is all we have, until the close. There are still some clues — like isolating the deeper dip to the noon hour, and like triggering the afternoon’s 2355.75 bias-up signal. Probing this morning’s high would be a clue, too, but only 2360.00 is being tested,

The final clue would deprecate the suggestion, by closing above Thu-Fri ~2361.00 prior highs. Now entering the final hour just under it, simply ranging flat-to-higher for an hour seems unlikely. This afternoon’s 2362.75 bias-up target is now “unfinished business above.” Add it to 2364.50.

Back under 2356.00 would suggest another downdraft underway, potentially undermining that sellers have been weak-handed. Otherwise, fresh highs today remain possible, if not also likely.

Will recovery back up to prior highs prove only a Pyrrhic victory?

Greeting this afternoon’s bias environment at 2356.00 triggered no-bias. Cleanly. Spiking up to 2360.75 at 1:30 doesn’t change that. The 2357.50 bias-up signal was probed too late to invalidate the no-bias. In fact, the spike was retraced almost immediately by 61.8%, testing 2357.50 as support.

And still testing 2357.50 as support. Trending above it would be “no-bias trending,” doomed to failure, back down to the 2357.50 bias-up signal, if not also the 2355.25 1:20 print, and possibly lower.

Potentially much lower. Remember how not recovering 2357.50 through a relevant timing window keeps the afternoon vulnerable to capitulating into the weekend? Well, probing above 2357.50 inappropriately increases that vulnerability.

Which all sounds pretty ominous. Because it can be… if triggered. A probe under last week’s 2317.75 test of would be in-play. Meanwhile, don’t discount the power of failing to trigger the trend’s bias signal Friday morning. The burden of proof here is definitely on sellers.