S&P
Post-market Wrap (recording & summary)
Closing above 2056.00 Tuesday could have undermined the morning’s break under it. Actually, closing above 2059.50 would have at least negated the downward momentum. Regardless, Tuesday’s close was at 2056.00, not being recovered, certainly not decisively. The retest of early-April’s consolidation is likely to give way.
Potential for another counter-trend bounce can’t be discounted, especially since 2056.00 was still being tested at Tuesday’s close. But unless Wednesday’s open were to gap up sufficiently to invalidate Tuesday’s break — similar to how Monday’s rally was invalidated — then the resolution is likely to be down.
Details and other markets coverage are discussed in the post-market Wrap recording here.
Monitor overnight Globex trading in the chaRTroom here.
Morning Bias
| TUE morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2067.25 | 2061.00 |
| …would target | 2072.25 | 2066.00 |
| Bias-down: under | 2059.00 | 2052.75 |
| …would target | 2053.00 | 2046.75 |
| Signal status: STILL TESTING BIAS-DOWN SIGNAL, 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.
Pre-close View… Speeding it up. And back down.
Corrective bounce fails to extend.
We already know the context of any bounce is a correction. That was dictated by this morning not compartmentalizing its probes under 2059.50. This morning’s 2048.00 low should be broken on the way down to 2030.00-2035.00, and lower.
None of which precludes a corrective bounce.
So, this afternoon’s 2057.00 bias-up signal triggered — a buy signal had triggered already above 2054.50 — and quickly rallied until coming to within 1 tick of its 2063.50 bias-up target. It held, instead of exiting the bias environment any higher to undermine the bearish context established this morning.
In fact, the bias environment is lapsing back at 2056.00, also a critical level. Until that actually breaks lower, the most bullish development possible would be to probe fresh highs above 2063.50 through the 3:10-3:20 timing window.
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 Jun Contract (EC, ETF: (FXE, UUP))
Australia’s surprise overnight rate CUT produced a test of the 1.1600 target. Closing above it would trigger higher targets, but otherwise there is no unfinished business above. Closing negative Tuesday makes Monday’s 1.14.85 low a sell signal.
Gold Jun Contract (GC, ETF: (GLD))
Monday’s choppy sideways ranging didn’t launch an immediate rally Tuesday, so any later probe higher is likely to hold a test of the 1312.50 target that closing above 1285.00 had triggered — so long as 1285.00 holds as support, which was tested Tuesday.
Silver Jul Contract (SI, ETF: (SLV))
Tuesday’s pullback held a test of 17.50 to avoid signaling momentum reversing down. Meanwhile, a retest of the 18.05 area highs remains likely, and higher highs would resume the rally targeting 18.80.
30-year Treasury Jun Contract (US, ETF: (TLT))
Closing Monday under 162-12 was rejected by Tuesday’s gap up to and through recent 163-12 highs. Extending higher intraday to test 164-08 produced the third higher close required by last week’s confirmed breakout. Not reversing down immediately under 163-12 could extend to 165-00.
Crude Oil Jun Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
The pullback extended lower Tuesday and probed under the 43.85 sell signal. This should define the pullback to keep alive near-term potential to produce a required fresh high close. So, the sell signal’s test is suspicious, and rejecting it Wednesday wouldn’t be surprising.
Natural Gas Jun Contract (NG, ETF: (UNG, UNL))
Gapping up above 2.07 prior lows on Tuesday negated Monday’s late break that had closed lower. But the gap back down to Monday’s 2.03 close should be filled before a reliable rally leg can begin — which might help to explain why the gap up never improved intraday.
Mid-day Update… Pushing back hard.
Bouncing back to the open.
10:15’s 2050.25 low was finally broken by more than an errant tick or two. That ended the potential for compartmentalizing this morning’s break under 2059.50. Meanwhile, that break bottomed at 11:30 at 2048.00. So, its sponsorship is similarly vulnerable to being compartmentalized.
This afternoon’s 2057.00 bias-up signal is a function of that last downleg. Recovering it, and its room for noise up to 2057.00, has now triggered bias-up. We assume the bias-up bounce is only a correction, which was dictated by this morning’s bias environment exit not recovering 2059.50.
Speaking of which, 2059.50 is now being probed by 1 point. It can be probed up to Friday afternoon’s high while being only noise. That’s essentially this afternoon’s 2063.50 bias-up target.
Exiting the afternoon bias environment any higher would be difficult to co-exist with the morning’s probe under 2056.00. It would require that Wednesday’s open gap significantly to reject one, or the other. For now, invalidating the current bias-up signal requires exiting this afternoon’s bias environment back under its 2050.50 bias-down signal.