S&P
Pre-market Tour (recording & summary)
The 2056.00 bias-up target was attacked to within 1 tick while reacting down from testing the 2061.25 renewed bias-up target. Neither of which is predictive without knowing how their tests will have resolved at 10:15. But the overnight rally should resume without much delay if it intends to extend intraday. Similarly, the bias-up target and its 2051.00 bias-up signal should be challenged early if the upside traction is inverting.
Details and other markets coverage are discussed in the pre-market Tour recording here.
The First Trade… Big shoes to fill.
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…
Tuesday’s opening 15 minutes of volatility elapsed entirely under Monday’s 2022.00-2023.00 lows. That’s an unstable base to launch a rally, and the bias environment exit didn’t recover the 2027.00 prior high. Yellen’s dovish remarks nevertheless triggered a surge back to Sunday night’s 2039.75 high. And that extended back to last week’s 2047.50 high.
Overnight action’s new info…
Extending even higher soon tested the next higher objective at 2051.00. A pullback to 2047.50 had been recovered into Europe’s opens, extending quickly up to 2058.25. Consolidating there for a couple of hours then broke higher again, testing 2061.50 before reacting down 3 points.
If, then…
The whole point to last week’s pullback was to correct the rally — specifically, its break above February’s highs — before resuming the rally to probe last year’s highs. The correction’s minimum objective was barely attacked to within 3 points Thursday at 2012.25. Its likelier objective at 1980.00 wasn’t even threatened. Yet, already new highs are printing for this year. That impatience left behind yesterday’s opening dip without actually absorbing or rejecting it, let alone retesting Thursday’s opening gap. Regardless of the sudden recovery’s degree, it’s still fresh, and still vulnerable. Its next higher objectives at 2051.00 and 2056.00 are also this morning’s bias-up signal and target, and their renewed bias-up target at 2061.25 is being tested. After expending a lot of impatient buying pressure overnight, what little traction was gained by yesterday afternoon’s buyers is at risk of inverting down. If 2061.25‘s test isn’t the start of this leg’s end, then doubly-renewing the bias-up would target 2067.00-2068.00.
First Trade…
Exiting the open at 9:45 under 2054.00 would be unlikely also to exceed the 2056.00 bias-up target or to renew the bias-up signal. Exiting the open above 2059.25 would be likely to renew the bias-up.
Morning Bias
| WED morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2060.25 | 2051.00 |
| …would target | 2065.25 | 2056.00 |
| Bias-down: under | 2050.75 | 2041.50 |
| …would target | 2044.00 | 2034.75 |
| Signal status: RENEWED BIAS-UP | 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)
1-minute and 3-minute RSIs didn’t actually diverge negatively into the 2047.50 high. With the 1-minute, RSI had not been overbought since much earlier and a little lower. As for 3-minute, RSI barely left overbought territory.
All of this developed upon touching last Tuesday’s 2047.50 actual high. Just touching last Monday’s 2044.50 pivotal high had required testing 2047.50. Already neutralizing the higher attraction tends to undermine the upside momentum.
All of this also developed while trending to fresh session highs through the 3:10-3:20 timing window. Barely. It was a net total of 2 ticks, or 6 ticks from high to low. The timing would complement the bias environment exit to reflect buyers gaining traction. Does 2-6 ticks deserve a benefit of the doubt for rewarding buyers with a Wednesday morning rally?
Extending higher would next target 2051.00 and potentially 2056.25. Nothing requires maintaining a higher high. But Tuesday morning’s probe under support through the opening windows does suggest a retest of its low.
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… Relentless.
Noon hour high’s retest hardly hesitates.
Actually, the noon hour high’s retest did react down briefly at its 2041.50 target. But that took only enough time to touch the 2040.25 pullback limit. Soon, the rally was extending up to 2046.25.
Meanwhile, last Monday’s 2044.50 high was touched. That’s called the “pivotal high,” being the high prior to last Tuesday’s 2047.50 actual high. Having probed under their interim low, recovering to touch the pivotal high all but requires revisiting the actual high.
The actual high isn’t always revisited immediately. Reacting down first is likely to recover. Today’s test doesn’t seem interested in more than a brief pause, as fresh highs are now within 3 ticks of 2047.50.
More important for tomorrow is whether the 3:10-3:20 timing window maintains its probe of fresh session highs. That would complement the bias environment exit having been above the noon hour’s high, gaining traction for extending higher tomorrow morning. Fresh highs could be probed anyway, but probably not maintained.