S&P
The First Trade… The go-ahead?
Proper context can start the day with a solid win and make all the difference.
CHARTROOM LINK(s)
o Win XP-Friendly entry
o non-xp friendly (ilinc)
(pre-open Market Tour begins at 8:55 ET)
Through the prior close…
Thursday morning was mechanical. Its sideways ranging held relevant support at 1977.00 through its relevant 10:15 time to create upside targets at 1998.00-1999.00. The afternoon’s FOMC Minutes release was as responsible for creating that mechanical morning, as it was for breaking it. Already rallying before the news triggered a spike up that eventually extended to within 3 points of last month’s 2011.75 high. Closing above 2000.00 kept alive potential fo rewarding the afternoon’s buyers for gaining traction, having exited the bias environment above the noon hour’s highs and entering the final hour even higher.
Overnight action’s new info…
Choppy sideways action has done nothing to contradict the upside traction, or to fulfill it prematurely. Probing fresh highs up to 2010.50 greeted Europe’s opens by plunging down to 1999.00. That has been recovered almost entirely to within 3 ticks. Each extreme is within a couple of ticks of this morning’s bias signals, suggesting that the ongoing pattern’s influence remains intact.
If, then…
Traction gained in the afternoon is usually rewarded the following morning by extending in that direction. Already extending much higher.that afternoon can moot the signal, but the late dip back down to 2000.00 neutralized that concern. Recently, trending sharply overnight has tended to fulfill that reward, but that’s not a factor currently.
First Trade…
Exiting the open at 9:45 above 2000.00 would be unlikely to trigger the 1999.50 bias-down signal at 10:15. Exiting the open above 2011.75 would be likely to trigger the 2011.00 bias-up signal at 10:15.
Post-market Wrap (recording & summary)
Is this leg coming to an end? Its 2011.75 objective was attacked to within 3 ticks Thursday afternoon. That was last month’s high, printed during Fed Chair Yellen’s press conference. The attraction back up to it was put into play earlier this week by probing the lower-end of that session.
A late reaction down still managed to close above 2000.00 to keep alive potential for extending higher Friday. Thursday afternoon’s buyers gained traction, which also keeps alive that upside potential. None of which prevents initially dipping overnight, or even through the open.
So long as sellers don’t retake control anyway Friday, the retest of 2011.75 should visit 2019.00. Retesting 2011.75-2019.00 early enough could reverse down sharply into the weekend.
Details and other markets coverage are discussed in the post-market Wrap recording here:
https://roddavid10.mitel-nhwc.com/join/wzjvsbj
This evening, monitor overnight Globex trading in the chaRTroom at:the ilinc room only… non-xp ilinc
Morning Bias
| FRI morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2019.00 | 2011.00 |
| …would target | 2024.00 | 2016.00 |
| Bias-down: under | 2007.00 | 1999.50 |
| …would target | 2002.00 | 1994.00 |
| Signal status: NO-BIAS, 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… Spittin’ distance.
Today’s FOMC behind us, last month’s FOMC ahead of us.
Huh?
This afternoon’s impending FOMC Minutes release is really neither here nor there. Little if anything about it is influential. Its surprises are usually irrelevant. Its real impact is in inhibiting price action ahead of its release.
So, this morning’s pattern was unlikely to extend higher, especially without gapping up. Filling the gap back to yesterday’s close and neutralizing the bias-up signal’s attraction were at first magnetic attractions above. They became repellent as trending ahead of FOMC anything is unlikely.
That repellent took price down low enough to enable a knee-jerk reaction too FOMC. Spiking up to the afternoon’s 1996.00 bias-up target was retraced to 1986.00. But that has been recovered to its next higher target at 2000.00.
And 2000.00 is sticking, not being rejected. So, the bias environment began lapsing above the noon hour’s range and the final hour is being entered above the bias environment’s high.
Buyers gained traction, but holding 2000.00 or not could make a difference. Closing above 2000.00 could extend higher tomorrow without delay. Closing under 2000.00 today can’t be assured of avoiding an interim dip.
Daily Spot… Action in the gaps.
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 Sep Contract (EC, ETF: (FXE, UUP))
There is no active signal, so Thursday’s probe above 1.1265 resistance doesn’t have any predictive value, regardless of it also extending intraday to probe last Friday’s 1.1330 high..
Gold Dec Contract (GC, ETF: (GLD))
Having filled the gap Wednesday back to the 2-1/2 week old close, and then closing flat-to-positive after reacting into negative territory, Thursday’s gap down was not expected to extend lower. In fact, it was retraced entirely back up to Wednesday’s “higher prior lows” as resistance.
Silver Dec Contract (SI, ETF: (SLV))
Extending higher to 16.10 through Wednesday never altered the pattern to raise its pullback limit any higher than 15.55. Thursday’s gap down had probed under it to 15.37, but still overlapping it keeps alive the potential for recovering the gap down and then resuming the rally.
30-year Treasury Dec Contract (US, ETF: (TLT))
More flat ranging ahead Thursday’s auction and FOMC Minutes came and went, without budging beyond its recent narrow range supported by the 157-24 sell signal. The door remains open to fill the gap back up to 158-24 before a more convincing break under the 157-24 and 156-16 sell signals.
Crude Oil Nov Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Not confirming Tuesday’s breakout Wednesday had not reversed the trend down, but Thursday only firmed back to Wednesday’s high, aided by bullish comments from OPEC about future demand.
Natural Gas Nov Contract (NG, ETF: (UNG, UNL))
Greeting Thursday’s EIA report from neither a position of strength nor of weakness — mostly the latter — enabled a favorable reaction that returned back up to Wednesday’s highs. Already having neutralized the gap above at 2.51, extending through it could target a higher gap outstanding at 2.67.