S&P
SPECIAL OVERNIGHT UPDATE: Sunday night”s
SPECIAL OVERNIGHT UPDATE:
Sunday night”s opening surge back to Friday afternoon”s high wasn”t an anomaly. It consolidated narrowly back down to 2106, then resumed rallying a couple of hours ago. Now 2115 is being attacked just minutes ahead of Europe”s opens. And RSIs are diverging negatively.
2115 is the lower-end of the 2114.75-2116.25 corrective bounce limit. Reversing down from here would be credible for launching a new downleg, but extending above 2116.25 would more likely retest Thursday”s prior high. That happens to be only 3 points higher at 2119.25 in this pattern, and its room for noise isn”t much higher. But its recovery would imply much more than that, resuming last week”s rally targeting new highs.
Another setup in-play is a “session-long rally” which rejects the prior afternoon”s downtrending, by gapping up above the prior afternoon”s high. Perhaps much more powerful would be to reject Friday”s entire session which had gapped down and trended down, by gapping up above its session highs. Those are bullish setups.
A substantial bearish setup remains possible. Hhaving fulfilled the 2114.50-2116.25 corrective bounce limit, breaking back under 2106 could resume Friday”s decline and retest last week”s lows under 2063. In other words, look out below if headlines don”t start aligning with price action”s suggestion that the Grexit can has been kicked further down the road.
chaRTroom links:
XP-Friendly: https://www.anymeeting.com/631-222-546
non-XP ilinc: https://roddavid10.mitel-nhwc.com/join/bfyytsh
In retrospect, it”s ironic that
In retrospect, it”s ironic that Greece got an extra day”s worth of funding Friday to cover bank runs. Five years of throwing good money after bad, but Friday”s one day of ELA was the best value yet — kicking the can for three days, due to the timing.
Was the extra day of funding intended to enable breathing room for Sunday”s creditor talks? Or, was limiting the extra funding meant to pressure negotiators, with another billion Euro in withdrawals already known? In the end, it seems not to have mattered. It is being reported that there are “no new proposals” on Greece, hence, no deal.
This seems to be coming as a relief. Sunday night”s Globex just gapped up to retrace all of Friday”s late 8-1/2 point slide. Our last sell signal at 2103.50 is now support of a surge to 2108.75. While it”s tempting to claim victory for expecting a relief rally when actual event finally came, keep in mind that Friday afternoon”s 2108.75 high is the real hurdle, as is Europe”s opens. And this follows Friday”s bearish afternoon bias that may similarly influence Monday morning.
Here are tonight”s links for front-row seats to watch the fireworks… Well, not exactly front row, but close enough to be just a little dangerous:
XP-Friendly: https://www.anymeeting.com/631-222-546
non-XP ilinc: https://roddavid10.mitel-nhwc.com/join/bfyytsh
Morning bias
| MON morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2114.25 | 2106.25 |
| …would target | 2119.50 | 2111.75 |
| Bias-down: under | 2105.00 | 2097.25 |
| …would target | 2097.50 | 2089.50 |
| Signal status: BIAS-UP, BIAS-UP TARGET EXCEEDED | 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.
Friday”s expiration session trended down
Friday”s expiration session trended down throughout. Yet, it was an “inside day,” contained entirely with Thursday”s range. And since Thursday trended up, Friday”s downward bias tends to be contratrend. The setup resembles Wednesday”s noon hour sell-off ahead FOMC”s statement, which reacted up sharply.
Another similarity to Wednesday is their lows. The pre-FOMC drop had touched support at the afternoon”s bias-down signal, literally expending as much selling pressure as was possible without gaining traction for the effort. Friday afternoon”s drop had potential to 2097.50, and that was its last minute low. In fact, post-close action has bounced back to 2100.
Nothing is perfectly identical, and there is one big difference between the two setups. Wednesday”s low was mid-day and mid-week. Bottom-fishers can be attracted if they have plenty of time to manage a bad entry. Friday”s low was at the very end of it all — not rallying (gapping up!) sharply on Monday would be vulnerable to doubling Friday”s drop.
Meanwhile, there is a question whether the late bullish WedEX failed, or inverted. The expiration open”s downtrend had initially undermined the setup, although the door remained open to reinstating it. If WedEX was actually inverted to be bearish, and Friday performed appropriately, then Monday morning would be likely to trend down, too. Whether from opening flat, higher or lower, post-open action is vulnerable to trending back down through the morning.
There”s no Saturday Review this weekend, but here”s Friday”s post-market Review:
https://roddavid10.mitel-nhwc.com/join/fbkzkrs
Pre-close view… Expiration egress.
Sellers gaining traction on an inside day.
Thursday”s range has yet to be probed in either direction, and might not be. That would make today an “inside day.” An inside day”s bias tends to be counter-trend. More so,an artificially influenced bias (e.g. expiration).
We”ll continue that discussion later.
Meanwhile, the afternoon”s bias environment was exited at 2:30 under the noon hour”s range, and the final hour was entered lower. Sellers gained traction for their efforts. The 3:10-3:20 timing window probed fresh lows, too — down to 2101.00 — but not durably.
Oversold RSIs make the drop vulnerable to reacting up, which can be exacerbated by the fast-approaching two-weekend”s illiquidity. Back above 2104.00 would start to signal a short-squeeze underway, albeit doomed to failure. Otherwise, the next lower attractions are 2099.25 and 2097.25.