S&P
Pre-close View… Detour, or die.
Overnight low’s retest is trying to hold.
The 1893.50 overnight low was retested all the way down to… 1982.50. Not quite the potential to 1881.00 of the pattern I’ve been tracking.
Nevertheless, its reaction just touched 1910.00. That tests the resistance of higher prior lows around 1906.00, and their prior high. Any higher upon entering the final hour could trigger a short-squeeze.
If the resolution is to be bearish, and if the anti-optimism conditioning classes have finally matriculated their last student, then 1910.00 will hold. More so, back under 1903.50 and 1899.00 will gather pace at a steeper slope as the decline announces it remains alive and very well.
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))
Probing above Friday’s high Sunday night was retraced back into Friday’s range Monday, but not reversed down, although that remains the likely resolution.
Gold Feb Contract (GC, ETF: (GLD))
Overnight strength was retraced back into Friday’s range as Friday’s pullback low remains likely to be retested as deeply as 1091.00 before extending the rally.
Silver Mar Contract (SI, ETF: (SLV))
Gapping up Monday was reversed entirely to probe back under Friday’s late plunge low, which isn’t necessarily bearish, and makes a recovery above 14.10 that much more bullish.
30-year Treasury Mar Contract (US, ETF: (TLT))
Fresh highs overnight fulfilled the 156-30/157-04 bounce limit before reversing to gap down at Monday’s open. Shallow follow-through was recovered only enough to fill the gap back to Friday’s close. That cautious optimism near the upside attraction makes a retest likely of the overnight highs.
Crude Oil Feb Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Reacting down from Friday’s 33.55 bounce limit test extended sharply lower Monday to fresh lows attacking the next lower support at 30.80. Closing under 31.35 keeps alive the momentum down.
Natural Gas Feb Contract (NG, ETF: (UNG, UNL))
Friday’s breakout wasn’t confirmed by a second consecutive higher close Monday. But gapping down created a gap back to Friday’s ~2.48 close that must be filled eventually, making the dip likely to be recovered. The pullback has room to 2.31 before suggesting anything deeper underway. Closing above 2.44 would be likely to extend the rally.
Mid-day Update… Stubborn.
Optimists learning at a glacial pace.
At least this morning’s gap up reversed down immediately. So, optimists are getting a little smarter. Not much, though. Friday’s gap was a little slower to reverse down, but not much. And prior gaps up had extended higher more and more briefly before reversing down.
Negative territory was probed earlier this morning than Friday. But not much. The bias environment had not yet ended today, but Friday’s drop dragged it out before failing.
There’s some sort of a pattern there.
The learning curve doesn’t advance simply by shortening distance between the usual inflection points. Rather, the curve stops repeating, and disappears altogether — replaced by a period of trending more consistently and at a steeper slope.
Unfinished business below at this morning’s 1899.75 bias-down target is now this afternoon’s bias-down target. Probing fresh post-open lows during the noon hour would start to suggest the pattern is shifting to post-optimism. Somehow rallying would suggest something much more substantial underway to the upside.
Look ahead: Economic Calendar – for Tue Jan 12, 2016
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: Tuesday’s post-open Job Openings report has a track record of influencing price action. The late timing of the afternoon’s Fed speaker could have even more impact than would be expected otherwise.
NFIB Small Business Optimism Index
6:00 AM ET
Redbook
8:55 AM ET
*JOLTS
10:00 AM ET
4-Week Bill Auction
11:30 AM ET
3-Yr Note Auction
1:00 PM ET
*Jeffrey Lacker Speaks
3:15 PM ET
Afternoon Bias
| MON afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 1928.00 | 1920.25 |
| …would target | 1933.50 | 1926.50 |
| Bias-down: under | 1914.75 | 1907.75 |
| …would target | 1907.00 | 1899.75 |
| Signal status: BIAS-DOWN | 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.