S&P
Daily Spot… Being scared into buying bonds.
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))
Monday night’s probe above 1.1265 was repeated intraday Tuesday and ultimately probed into late-afternoon, which undermines resuming the decline unless rejected aggressively without delay.
Gold Dec Contract (GC, ETF: (GLD))
Lower lows overnight were repeated intraday, keeping in-play potential down to 1117.00, which would be confirmed under 1125.00.
Silver Dec Contract (SI, ETF: (SLV))
Narrow ranging Tuesday held above 14.50 to avoid putting into play fresh lows under 14.20, and still allowing a close above 14.65 to signal the pullback had ended.
30-year Treasury Dec Contract (US, ETF: (TLT))
Fresh highs overnight at 158-00 were reversed in time for Tuesday’s open to gap down, but that didn’t prevent retesting overnight highs intraday. The rally remains more vulnerable to extending than to collapsing during a flight-to-quality, and until closing back under 156-16.
Crude Oil Nov Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Trading firmer Tuesday didn’t recover the 46.00 bounce limit that keeps 42.80 in-play below.
Natural Gas Nov Contract (NG, ETF: (UNG, UNL))
Retracing back into the range Monday after gapping up above it left “unfinished business above” at its opening print. That didn’t prevent probing the range’s 2.63 lower-end intraday, down to last Thursday’s EIA knee-jerk reaction down to 2.59. Closing back above 2.63 would signal the range’s lower-end was still holding, and potentially launching a rally leg.
Mid-day Update… Positive territory? Really?
Reacting to the noon hour piercing negative territory.
This morning’s recovery from fresh lows hasn’t dragged bulls out from their hiding places.
The bounce back up to 1889.00 resistance reacted back down to 1868.50. That’s 3 points under yesterday’s cash session close. It was also under the 1872.25 bias-down signal, which recovered in time to trigger “late no-bias.”
“No-bias” allows room up to this afternoon’s 1886.00 bias-up signal. It’s not required to use all that room, and it wasn’t — natural resistance at a 61.8% of the downleg held at 1881.50.
Now the bias environment is lapsing, and the choppiness should end. Retesting the 1872.25 bias-down signal as support has reacted up to 1879.00. It reacted up aggressively which is appropriate if momentum is reversing up.
Look ahead: Economic Calendar – for Wed Sep 30, 2015
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: It’s payrolls week, so we get a few extra looks at the job market. ADP’s reaction can help to inform the market’s sentiment. The reaction can also inform us to the likely reaction to post-open PMI. Regardless, PMI is released privately to institutional subscribers, and any reaction is likely to repeat when released publicly. Yellen speaks in the afternoon, which should inhibit price action just before any opening remarks.
MBA Mortgage Applications
7:00 AM ET
*ADP Employment Report
8:15 AM ET
*Chicago PMI
9:45 AM ET
EIA Petroleum Status Report
10:30 AM ET
*Janet Yellen Speaks
2:00 PM ET
Afternoon Bias
| TUE afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 1896.00 | 1886.00 |
| …would target | 1902.25 | 1892.25 |
| Bias-down: under | 1882.25 | 1872.25 |
| …would target | 1876.00 | 1866.00 |
| Signal status: LATE NO-BIAS, TESTED 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.
Post-open Review… Will it stick?
The get out of stocks crowd got in and got out.
I had planned to sell an opening surge’s reaction down from 1887.00-1889.00, not much lower than 1974.00-1975.00 if needed. Its objective was a probe under yesterday’s lows, which was all but required since the session-long downtrend can only produce a momentum low — not the actual low.
My plan worked perfectly, except that the open was greeted by a slide already testing 1974.00-1975.00. It offered little support before extending to fresh lows at 1865.75. Only afterward did a bounce test 1887.00-1889.00.
Structurally, just probing under yesterday’s low allows the decline to end. Even in the most bullish scenario, yesterday’s session-long downtrend low could serve only as a momentum low requiring a retest. A multi-session bounce is free to develop.
Free to develop, and yet to develop. Potential down to 1864.00 wasn’t necessarily satisfied by testing it only overnight. Oversold RSIs at today’s 1866.00 post-open low would probably include its retest.