S&P
Pre-close View… Hope springs.
Support bounce gets carried away.
RSIs improved into the noon hour’s test and retest of 2160.00. Its test Friday afternoon had ended a multi-session decline, and launched a substantial corrective bounce. Its retest is vulnerable to extending down, and likely to extend down eventually.
Not today, apparently.
Exiting the bias environment above the noon hour high probing 2166.00 was not confirmed at the final hour entry. The 3:10-3:20 proxy window had probed fresh session highs up to 2169.00, but the bias environment high was still being overlapped at 3:20. No upside traction.
None of which prevents extending higher, anyway. A sell signal at 2163.50 was only touched, expending all available weak-handed selling pressure. Buy signals were triggered, targeting the 2170.75-2171.50 area. It’s being attacked now to within 1 tick, while RSIs diverge negatively.
Presumably, this is not a recovery, but a corrective bounce. And the decline remains vulnerable to resuming without delay, if not likely.
Daily Spot…
A daily summary of high-profile members of several complexes… View a more detailed discussion of each chart at the end of today’s Market Wrap.
Eurodollar Sep Contract (EC, ETF: (FXE, UUP))
Wednesday’s shallow gap down bounced quickly back into Tuesday’s range, and soon tested the 1.1175 sell signal that Tuesday had broken under. Holding it as resistance didn’t undermine the break’s momentum, still targeting fresh lows.
Gold Dec Contract (GC, ETF: (GLD))
Sliding sharply again Wednesday to 1307.00 keeps alive the decline’s momentum and its 1296.00-1297.00 target, which is in-play so long as bounces were to hold 1316.00 as ressitance.
Silver Dec Contract (SI, ETF: (SLV))
Avoiding a probe of lower lows Wednesday without reversing up doesn’t negate the outstanding requirement for at least an eventual third lower close. Holding up while Gold slides sharply may find heavy rotation into Gold when its downside target is met, which would enable Silver to retest Sunday night’s low.
30-year Treasury Dec Contract (US, ETF: (TLT))
Rolling coverage forward to Dec, at about a 1-14 discount to Sep… Wednesday’s choppy, sloppy ranging at least ranged more narrowly, just around Tuesday’s range, but still short of its 171-02 buy signal.
Crude Oil Oct Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Two days of ineffectual optimism that had tried avoiding a break under 46.60 were greeted by Wednesday’s gap down that extended sharply lower in reaction to EIA. The pattern next targets 41.45 on a second consecutive lower close Thursday.
Natural Gas Oct Contract (NG, ETF: (UNG, UNL))
Tuesday’s test of the 2.82 sell signal was already suspicious. Wednesday’s immediate bounce back up to what had been the 2.88 pullback limit would confirm by closing above it, which would greet Thursday’s EIA from a position of strength.
Mid-day Update… Stopping optimistically short.
Retesting same level that held Friday’s drop.
Friday’s low formed when its intraday decline filled a three-week old gap back down to 2160.00. Its “unfinished business below” was one of several that offered context to the subsequent rally being unsustainable. Anyway, its late-afternoon test couldn’t attract new sponsorship, and price bounced into the weekend.
Now Monday’s interim rally to 2181.50 has been retraced to retest 2160.00.
The test this time is shallower, barely piercing 2160.00. It did trigger the 2164.50 bias-down signal, and its target is to probe 1 point under Friday’s 2157.50 bias-down target.
Today’s price action is entirely in-line with the massive topping rolling over. But even if we knew with a 100% degree of certainty the bounce would resolve down, a bigger detour can’t be dismissed. Not too much — there’s still limited time for a drop to get underway or out-of-the way.
Look ahead: Economic Calendar – for Thu Sep 1, 2016
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: Thursday’s calendar is heavy, even when considered in the context of an otherwise busy week. Pre-open reports are high-profile, but not necessarily influential. Nevertheless, any reaction to the pre-open reports is likely to be duplicated by the post-open reports. The noon hour’s Fed speaker is among the least influential to price action.
Challenger Job-Cut Report
7:30 AM ET
Jobless Claims
8:30 AM ET
Productivity and Costs
8:30 AM ET
Gallup Good Jobs Rate
8:30 AM ET
*PMI Manufacturing Index
9:45 AM ET
Bloomberg Consumer Comfort Index
9:45 AM ET
*ISM Mfg Index
10:00 AM ET
Construction Spending
10:00 AM ET
EIA Natural Gas Report
10:30 AM ET
*Loretta Mester Speaks
12:25 PM ET
Fed Balance Sheet
4:30 PM ET
Money Supply
4:30 PM ET
Afternoon Bias
| WED afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 2172.00 | 2170.75 |
| …would target | 2178.00 | 2177.00 |
| Bias-down: under | 2165.50 | 2164.50 |
| …would target | 2157.75 | 2156.50 |
| Signal status: BIAS-DOWN | FAQ | |
| INTRO VIDEOS #1 and #2 | ||
1. At 1:20, trading above the bias-up signal or under the bias-down signal would put into play a test of its bias-up or bias-down target.
2. Not triggering either bias signal at 1:20 would be “no-bias,” and the bias signals should define the bias environment’s range.
— A test of the opposite bias signal would be targeted if one bias signal was tested before triggering no-bias.
3. Touching the bias signal within 3 minutes either way of 1:20 would invoke a grace period through 1:30 to trigger a late signal.
— “Late” signals don’t require testing the opposite bias signal, but it’s still likely.
4. Still testing the bias signal at 1:30 after invoking the grace period would trigger “noN-bias,” with no bias influence.