S&P
Look ahead: Economic Calendar – for Mon Aug 15, 2016
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: Monday’s reports are high-profile, but neither has a reliable track record for influencing price action.
Empire State Mfg Survey
8:30 AM ET
Housing Market Index
10:00 AM ET
3-Month Bill Auction
11:30 AM ET
6-Month Bill Auction
11:30 AM ET
Treasury International Capital
4:00 PM ET
Afternoon Bias
| FRI afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 2187.25 | 2184.00 |
| …would target | 2192.50 | 2189.50 |
| Bias-down: under | 2179.00 | 2176.00 |
| …would target | 2174.00 | 2170.75 |
| Signal status: NO-BIAS | 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.
Post-open Review… Settling in.
Gap down not extending. Not ,yet.
The pre-open PPI reaction gapped down to the same 2178.00-2179.00 open of the prior two sessions. They had found sponsorship through the morning. Not today. The first minute blipped-down to 2176.75 and then bounced back up.
Actually, “bounced back up” exaggerates things. Price has firmed choppily back up to 2181.00, still overlapping the open. So, the gap down may not have extended deeper, but it also isn’t being rejected.
Choppiness aside, the pattern should creep higher to 2183.00. That would overlap yesterday’s cash session close by several ticks. The pattern’s next leg should be much cleaner trending — if not reversing to resume and extend the gap down as is likelier, then potentially drifting higher into the close.
Pre-market Tour (recording & summary)
Two pre-open econ reports were greeted at yesterday’s 2182.25 cash session close. The reaction plunged to a fresh low at 2178.75. That’s not much, unless compared to the overnight range, and even to yesterday afternoon’s range. The gap back to yesterday’s close doesn’t require being filled before extending down, although that’s common first. Probing a new high without gapping up in this pattern would be likely to reverse back down sharply, but not necessarily on a Friday. No matter how likely to resolve down, nothing yet prevents extending higher — especially on a Friday.
Details and other markets coverage are discussed in the pre-market Tour recording here.
The First Trade… Central banks on holiday?
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)
Through the prior close…
Thursday’s gap up to 2178.00-2179.00 was more successful than Wednesday’s gap up to 2178.00-2179.00. Both probed lower soon after the open, but Thursday recovered above the overnight highs. And then to fresh highs. And finally to new highs. Wednesday had declined through much of the day without gaining traction, so it’s interesting to note that it was followed by a rally. Thursday’s rally, meanwhile, didn’t gain traction, and created no higher attraction.
Overnight action’s new info…
New highs, again, and still no overnight enthusiasm about it. Not even rejection, which at least would anticipate volatility. Thursday’s late 5-point reaction down from 2185.50 didn’t extend. But a 3-point range expanded to 4 points at Europe’s opens, and is still trading flat with yesterday’s close. That’s just complacency, which is usually ended by exploding in one direction, or the other.
If, then…
Yesterday’s late, momentary surge was well-positioned to extend higher on a short-squeeze. Quickly absorbing the inflection point instead and reacting down suggests very little short interest is available up here to be squeezed, at this stage of the rally. Which has been an ongoing characteristic during the past several weeks, whether immediate or delayed one day. Pessimistic shorts would be bullish from a contrarian perspective. So far, their absence.is more of a “sell strength” signal than an outright sell. This being a Friday, reversing down from another fresh high or just dropping would likely extend through the noon hour. By the same token, this being a Friday, another fresh high that does NOT quickly reverse down could drift higher into the weekend.
First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 above 2187.00 would be likely to trigger the 2185.50 bias-up signal at 10:15. Exiting the open under 2181.00 would be unlikely to trigger bias-up,