S&P
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 Mar Contract (EC, ETF: (FXE, UUP))
Exploiting Wednesday’s gap fill and extending higher Thursday through 1.0950 was partially rejected by gapping down Friday back under 1.0950 and extending down sharply.
Gold Feb Contract (GC, ETF: (GLD))
Flat-to-lower ahead of Friday’s open was able to hold the 1114.00 pullback limit again, but shouldn’t further delay extending the rally if its momentum remains intact.
Silver Mar Contract (SI, ETF: (SLV))
Thursday’s dip didn’t extend down Friday, but still must recover above 14.35-14.40 to resume the rally.
30-year Treasury Mar Contract (US, ETF: (TLT))
Retesting the prior high now allows the rally to peak, whether immediately or after extending to test 162-26. Interestingly, the strength accompanies stock market strength, without a “flight-to-safety” catalyst.
Crude Oil Mar Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Friday’s early strength attacked the 34.80 bounce target that had been met Thursday. Its reaction down into negative territory stopped short of testing the 32.50 pullback limit, keeping alive potential for extending to 37.20.
Natural Gas Mar Contract (NG, ETF: (UNG, UNL))
Recovering Thursday from its dip had kept alive the basing pattern, yet again, by closing back above 2.14. Friday’s gap up to 2.30 helps to signal the bottom is done forming, but a second consecutive higher close Monday would confirm a new upleg is underway. Meanwhile, a test of “lower prior highs” at 2.19 would temper the excessive optimism.
Mid-day Update… What could possibly go wrong.
Productive trend, targets met, RSIs diverging… wait, what?
Consolidating through the bias environment’s end had formed a reliable accumulative pattern. It broke higher through 1910.00 to fulfill the 1913.00 objective. It extended higher through there to fulfill this afternoon’s 1919.75 bias-up target (by 1 tick).
The accumulative pattern’s corrective phase is biased upward. That reflects optimism, which tends to be sorely missed when new highs are probed. So far, that issue isn’t bothering the pattern’s breakout. But RSIs are deteriorating quickly.
Back under 1915.75 would start to signal momentum reversing down. Back under each prior would confirm. Exiting Friday afternoon’s bias environment by counter-trending can be pretty powerful before the close. But don’t get caught short of the bias environment exit is probing fresh highs.
Look ahead: Economic Calendar – for Mon Feb 1, 2016
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: Friday’s post-open ISM report is reliable for influencing price action. Any reaction to the pre-open reports is likely to repeat for ISM.
Personal Income and Outlays
8:30 AM ET
Gallup US Consumer Spending Measure
8:30 AM ET
PMI Manufacturing Index
9:45 AM ET
*ISM Mfg Index
10:00 AM ET
Construction Spending
10:00 AM ET
3-Month Bill Auction
11:30 AM ET
6-Month Bill Auction
11:30 AM ET
Afternoon Bias
| FRI afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 1920.50 | 1913.75 |
| …would target | 1926.50 | 1919.75 |
| Bias-down: under | 1911.25 | 1904.50 |
| …would target | 1905.25 | 1898.50 |
| Signal status: 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… Got there.
Fresh high finds resistance.
Opening at the 1893.50 bias-up signal extended higher almost immediately into a congestion around the 1898.50 bias-up target. Surging out of it to 1907.00 was extended up to 1911.50.
That’s above Wednesday’s 1910.00 prior high. And that’s where early strength risked reversing down hard. That was especially a risk from 1913.00, but it wasn’t touched. And its reaction down was delayed.
So, a pullback to 1902.00 is now trying to recover. Perhaps even to resume the rally, next targeting 1913.00. Otherwise, back under 1902.50 would target 1898.50 for a last chance to resume rallying today.