S&P
Pre-market Tour (recording & summary)
The last overnight bounce to 2175.00 was retraced entirely back down to its 2169.75 low, and through it by 3 ticks. Shallow ranging there hasn’t recovered. Nor has it extended just another tick to at least touch yesterday’s late-afternoon 2168.75 low. That still reflects optimism, or restrained pessimism, either one being potentially bearish from a contrarian perspective.
Details and other markets coverage are discussed in the pre-market Tour recording here.
The First Trade… Sellers at the gate.
Proper context can start the day with a solid win and make all the difference.
CHARTROOM LINK
(pre-open Market Tour begins at 8:55 ET)
SPECIAL NOTE: I will be away from the screens on the afternoons of both Thursday and Friday, this week and next, Thank you for allowing me to be of personal assistance in a family matter.
Through the prior close…
Wednesday’s open immediately resumed Tuesday’s slide under 2185.00, to a late-afternoon low of 2168.75. A last-minute 7-point bounce peaked 1 point short of 2177.00, which had been the decline’s likely objective. Recovering it would have allowed the drop since Tuesday’s open to be considered only a temporary correction on the way to new highs. Closing under 2177.00 instead suggests the massive topping pattern we’ve been monitoring is now rolling over.
Overnight action’s new info…
Relatively narrow sideways ranging continued to hold 1 point under 2177.00 resistance. Sliding into and out of Europe’s opens attacked yesterday’s 2168.75 low to within 1 point at 2169.75. Bouncing back up to 2175.00 has been retraced to within 1 point of 2169.75..
If, then…
Gapping open Thursday back above 2177.00 would not be as relevant as if Wednesday had closed above it already. Rejecting Wednesday’s close under 2177.00 would now require gapping up above the 2180.50-2181.25 area. For starters. Any shallower strength would be likely to resume the decline for a third consecutive session — and probably more aggressively as participants start getting the point. Otherwise, attempting to reject the decline wouldn’t ensure extending back up to new highs, and would remain vulnerable to attempting another downleg anyway.
First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 under 2170.00 would be likely to trigger the 2171.50 bias-down signal at 10:!5. Exiting the open above 2177.00 would be unlikely to trigger bias-down. Exiting the open above 2180.50 would be likely to trigger the 2178.75 bias-up signal.
Morning Bias
| THU morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2180.75 | 2178.75 |
| …would target | 2186.25 | 2184.25 |
| Bias-down: under | 2173.50 | 2171.50 |
| …would target | 2168.25 | 2166.25 |
| Signal status: LATE NO-BIAS, TESTED BIAS-DOWN SIGNAL | FAQ | |
| INTRO VIDEOS #1 and #2 | ||
1. At 10:15, 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 10:15 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 10:15 would invoke a grace period through 10:30 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 10:30 after invoking the grace period would trigger “noN-bias,” with no bias influence.
Post-market Wrap (recording & summary)
Wednesday’s last-minute 7-point bounce peaked 1 point short of 2177.00. Its recovery would have kept alive potential for the drop from Tuesday morning’s high to have been only a correction, prior to resuming the rally. Closing under 2177.00 instead suggests the drop has been the beginning of the end, completing the massive topping pattern we’ve been monitoring.
Having failed to close back above 2177.00, recovery potential can be reinstated by gapping back up above the 2180.50-2181.25 area. That wouldn’t ensure new highs, and would remain vulnerable to attempting another downleg. Wednesday’s attempt at a new downleg is still subject to confirmation from a second consecutive lower close.
The Schrödinger’s cat setup.
Details and other markets coverage are discussed in the post-market Wrap recording here.
Monitor overnight Globex trading in the chaRTroom here.
Pre-close View… Paradigm shift.
Target met. Timing window lapsed. Direction down.
This morning’s 2177.00 bias-down target was met at the afternoon bias environment’s low. Its consolidation just broke lower, after entering the final hour.
Entering the final hour under 2177.00 would have been more clearly bearish. Despite probing it now down to 2173.75, it can recover. And closing back above it could launch a rally to new highs. Closing under 2177.00 — and under 2170.75 if touched — would launch a sizable new downleg.
The bias environment was exited under the noon hour’s low, but the final hour’s entry wasn’t lower, so traction isn’t assured. Bouncing into the close cannot be discounted.