S&P
Pre-close view… Bullet dodged?
Bazooka shells on Monday?
Even before this morning”s price action had only ranged sideways, the likeliest afternoon scenario was to range sideways if a plunge wasn”t developing.
This morning”s price action did range sideways, and the afternoon has probed fresh post-open lows at 1971.50. But the open”s decline has not extended, so price action has begun ranging narrowly sideways.
If a plunge targeting 1938.00 or any downleg through the 1967.,25 overnight lows is happening today, then it should be obvious pretty soon. Getting too far into the position-squaring window after 3:37 could drop, but not from bearish sponsorship.
Don”t forget to join us in the chaRTroom at 4:03 ET for the post-market Wrap.
Daily Spot… Market timing the Saudis
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))
Friday”s flat open precluded forming an Island Reversal from Thursday”s range. But the combined Thursday-Friday pattern may still form an Island if Monday”s open were to gap up.
Gold Dec Contract (GC, ETF: (GLD))
Brief overnight strength and then again post open began probing above the 1130.40 buy signal up to 1140.00, suggesting a tleast a test of 1147.40 is in-play.
Silver Sep Contract (SI, ETF: (SLV))
Thursday”s bounce to 14.55 resistance hovered optimistically Friday, still needing to fill the gap back down to Wednesday”s 14.31 open before a durable recovery would be credible.
30-year Treasury Sep Contract (US, ETF: (TLT))
Friday”s probe above the 157-07 buy signal was more productive than Thursday”s attempt before falling back to 156-16. The buy signal remains valid nonetheless.
Crude Oil Oct Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Backed into a corner with falling prices, the Saudis have taken matters into their own hands to goose prices. Now we know why Thursday”s rally was so substantial despite my target having been missed by 20 cents at the lo — Saudis were entering Yemen. The news pushed price even higher, no doubt aided by two days of impending illiquidity and the return of a pre-weekend premium for geopolitical risk. Back under 42.75 would suggest fresh lows in-play at 37.55.
Natural Gas Oct Contract (NG, ETF: (UNG, UNL))
Friday”s gap up didn”t leave any unfinished business below since Thursday”s range was essentially an inside day. The pattern remains credible for launching a new upleg so long as new lows are avoided.
Walking on eggshells.
No-bias environment isn”t quite rejecting sellers.
Neither bias signal was touched before 1:20, so “no-bias” triggered. No bias target was in-play, and neither was an offsetting test of the opposite bias signal (although that setup is more influential during the morning than during the afternoon).
The 1973.75 bias-down signal was tested anyway, down to 1971.50. But being a no-bias environment, that has reacted up (quite a big, actually, to 1983.25).
None of which changes whether buyers are gaining traction. They”re not. And the entire morning was spent back-and-filling, while neutralizing the offsetting test of its 1990.00 bias-up signal. This is one of the two bearish scenarios discussed during the pre-market Tour. And it”s the only one still active.
The bullish scenarios are all less likely than just ranging sideways through the close. Not that ranging sideways through the close is likely.
Look ahead: Economic Calendar – for Mon Aug 31 2015
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: All Fed surveys but one is reliably influential, but that”s becoming less so as the rate hike question looms. So, a reaction to Dallas Fed is possible. Its reaction is likely to be in-line with the Chicago PMI, which tends to set a tone. Also, it”s released privately to institutional subscribers and any market reaction is likely to be duplicated when released publicly.
**Chicago PMI
9:45 AM ET
*Dallas Fed Mfg Survey
10:30 AM ET
3-Month Bill Auction
11:30 AM ET
6-Month Bill Auction
11:30 AM ET
Farm Prices
3:00 PM ET
Afternoon bias
| FRI afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 1989.25 | 1986.25 |
| …would target | 1999.25 | 1996.00 |
| Bias-down: under | 1977.00 | 1973.75 |
| …would target | 1970.75 | 1967.50 |
| Signal status: NO-BIAS | 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.