S&P
Look ahead: Economic Calendar – for Tue May 17, 2016
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: Any reaction to Tuesday’s pre-open CPI is likely to be duplicated by reactions to the morning’s later econ reports. The two Fed speakers are capable of triggering at least a reaction. Fed presidents Lockhart Williams are supposedly being interviewed by Politico at some point intraday.
Neel Kashkari Speaks
MON 7:00 PM ET
*Consumer Price Index
8:30 AM ET
Housing Starts
8:30 AM ET
Redbook
8:55 AM ET
Industrial Production
9:15 AM ET
E-Commerce Retail Sales
10:00 AM ET
4-Week Bill Auction
11:30 AM ET
*John Williams Speaks
12:00 PM ET
*Robert Kaplan Speaks
1:15 PM ET
Afternoon Bias
| MON afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 2065.00 | 2061.00 |
| …would target | 2070.75 | 2066.75 |
| Bias-down: under | 2057.25 | 2053.25 |
| …would target | 2050.75 | 2046.75 |
| Signal status: LATE BIAS-UP | 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… Marginalizing sellers.
No immediate drop means rally likely.
As we discussed during this weekend’s Saturday Review, selling pressure must be compartmentalized to prevent it gaining traction. And not immediately extending down this morning would default to be bullish.
Last night’s spike down to 2035.00 was never repeated post-open (not even overnight). And the flat 2043.50 open rallied immediately.
Fulfilling the setup has led to triggering the 2050.50 bias-up signal. A test of the 2056.00 bias-up target is in-play.
Fresh highs are testing 2054.00, which retraces 61.8% of Friday’s intraday range. There is room for noise above the bias-up target to 2058.50.
Sellers aren’t likely to regain control before this afternoon, if at all. Any downdraft will be considered temporary if the bias-up target hasn’t yet been met. Meanwhile, extending even higher this afternoon would signal the multi-week rally was being retraced.
Pre-market Tour (recording & summary)
Perhaps Sunday night’s spike down was in reaction to pro-Brexit weekend news. A quake in Tokyo hasn’t rattled the narrow range around unchanged. The quakes in AAPL (Buffet taking a $1b stake) and beaten-down Biotechs (PFE buying ANAC) haven’t had an effect, either. Or, their effects are tugging equally at each other to gain control.
Details and other markets coverage are discussed in the pre-market Tour recording here.
The First Trade… Coiling.
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…
Friday morning’s choppiness had ranged between 2051.50-2063.50, literally 6 points either way around its flat 2057.00 open. Two probes into positive territory were each followed by probing negative territory. The second probe never recovered, sliding through the noon hour and bias environment. The 2046.00 overnight low was probed down to 2038.50, back into the prior Friday’s range, before firming to close at 2042.25-2043.50.
Overnight action’s new info…
Sunday night’s open spiked down to 2035.00 and immediately began firming. The steady rise had soon recovered positive territory, eventually probing it up to 2049.25. Gradually lower highs have been hovering for hours at or above Friday’s 2042.25-2043.50 close.
If, then…
Dipping into the prior Friday’s range — the multi-week decline’s lows — essentially requires resolving suddenly. Essentially. Almost any delay to resolving down would get a slight benefit of the doubt for resolving up, if only by default as the decline fails to attract new sponsorship. Actually, ONLY by default. Rallying would still need to trigger a signal, at least a bias-up. Meanwhile, probing lower can still be absorbed if not maintained through a relevant timing window. Last night’s momentary spike down is one example that I described during this weekend’s Saturday Review.
First Trade…
Oddly, there are no preliminary levels in the overnight pattern for anticipating the morning’s Bias signal.