S&P
The First Trade… Heavy load.
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…
Monday”s narrow overnight range centered around 2093.00 quickly launched an opening rally. It trended higher intraday to eventually touch its 2105.50 maximum objective. Buyers gained traction for their effort, while confirming Monday”s breakout. .
Overnight action”s new info…
The first order of business was to fulfill the 2099.25 objective of the last-minute reaction down that had begun from Tuesday”s. Its touch reacted up and began surging to a fresh high at 2107.50. That was short-lived, as the balance of the night settled down into a narrow 3-point range back to 2102.00.
If, then…
The rally need not resume immediately, regardless of Tuesday afternoon”s buyers having gained traction, while confirming Monday”s breakout. Actually, those are the reasons why the rally is vulnerable to reversing down — because having entrenched its uptrend, a corrective dip can be more easily absorbed. Nevertheless, exiting the open above yesterday”s high would be credible for extending higher through at least the morning. Either way, Yellen”s televised congressional Q&A is a likely catalyst.
First Trade…
Exiting the open at 9:45 above 2105.50 would be likely at least to test the 2108.50 bias-up signal. Exiting the open under 2105.50 would be unlikely to trigger bias-up. Exiting the open under 1097.50 would be likely to trigger the 2099.25 bias-down signal.
Tuesday morning”s 2101.75 bias-up target
Tuesday morning”s 2101.75 bias-up target was met into the noon hour. The afternoon”s bias-up signal didn”t trigger, but that didn”t prevent ultimately touching the 2105.50 objective discussed during the pre-market Tour. Other than the objectives of an eventual third higher close and to retest the highs, there is no specific higher calculable attraction.
Correcting down would create another swing and more complexity, from which specific higher targets could be calculated. The rally gained traction Tuesday afternoon, which allows it to rest on its laurels by retracing… within limitations.
More details and other market coverage were discussed during the post-market Wrap recording:
https://roddavid10.mitel-nhwc.com/join/zvvtzfc
Overnight chaRTroom links:
XP-Friendly: https://www.anymeeting.com/978-117-134
xp UN-friendly: https://roddavid10.mitel-nhwc.com/join/shkphyy
Morning bias
| WED morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2115.75 | 2108.50 |
| …would target | 2120.50 | 2113.50 |
| Bias-down: under | 2106.25 | 2099.25 |
| …would target | 2100.00 | 2092.75 |
| Signal status: NO-BIAS | 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… Standing still would soon fall.
“Standing still is to fall behind.” – R. Buckminster Fuller
The rally followed my strategy for hovering under the noon hour”s highs until the bias environment began lapsing. Breaking above 2101.50 has extended 3 points to fresh highs testing 2104.25.
That may extend higher to test 2105.50. Regardless, the fresh highs create more room to absorb selling pressure, so that today”s close can still confirm yesterday”s breakout.
Meanwhile, the bias environment was exited above the noon hour”s high. The rally would gain traction if that were combined with entering the final hour above the bias environment”s 2102.75 high, or trending up to fresh session highs above 2104.50 through the 3:10-3:20 timing window.
But entering the final hour back under the morning”s 2101.50 high, or trending under it through 3:10-3:20 — would start to reverse momentum down. And this setup”s objective would be to close negative on the day.
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 Sep Contract (EC, ETF: (FXE, UUP))
Monday”s test of 1.1000 support was probed slightly overnight before bouncing into Tuesday”s gap up. Filling the gap back down to 1.0935 remains in-play, so the bounce quickly peaked upon attacking 1.1100 and reversed back down to 1.1000 support.
Gold Aug Contract (GC, ETF: (GLD))
Having recovered only to 1158.50 Monday but no higher, Tuesday”s narrowly ranging inside day reinstates the potential for trending through 1158.50 and 1163.00 to signal a new rally leg..
Silver Sep Contract (SI, ETF: (SLV))
Monday”s low was pierced overnight but Tuesday”s intraday range was otherwise an inside day. Its downward bias would make a surge through 15.45 credible to gain traction.
30-year Treasury Sep Contract (US, ETF: (TLT))
Narrow ranging Tuesday around Monday”s close didn”t qualify as the fresh low, which is still needed at 148-08 or lower, before a buy signal would be credible any lower than 150-24.
Crude Oil Aug Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
An overnight dip in reaction to the Iran treaty”s announcement was recovered back to 52.00 support before Tuesday”s open. But that still wasn”t reversed up to even attack the 54.30 buy signal, making fresh lows targeting 48.00 increasingly possible.
Natural Gas Aug Contract (NG, ETF: (UNG, UNL))
Probing higher overnight tested 2.93 at Tuesday”s open before reversing down intraday to test 2.83 as support. The pattern shouldn”t require any further backing-and-filling before extending to probe above 3.00.