S&P
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Wednesday afternoon”s bias environment was exited at 2066. This is the lower-end of a range that was attacked last Thursday before Friday”s May Day rally. Its the lower-end of a range that was tested in mid-April. There”s some other congestion in the area, but the basic point is that 2066 is pretty significant support. And pretty well-worn.
If this 2066 area intends to prevent a larger downleg, then a rally effort must be obvious during Thursday morning”s bias environment. This area is not a position of strength to be greeting Friday”s payrolls report, let alone from lower.
That mid-April session which had held a test of 2066, had begun by gapping down under 2090-2095 from above it. Despite spending the entire session exclusively under 2090-2095, the following session gapped up above it and extended to new highs. Wednesday was the first session since then to be spent exclusively under 2090-2095. Just closing above it Thursday should be enough to marginalize sellers.
NEW CHARTROOM LINK
Please help me test this new conferencing candidate. We”ll be using it Thu-Fri. Let me know its audio quality and other thoughts.
http://chaRTroom.enterthemeeting.com
If that isn”t stable overnight, use this backup link, and I”ll have an xp-friendly solution before the open.
https://roddavid10.mitel-nhwc.com/join/bfyytsh
MARKET WRAP
Wednesday”s post-market Wrap recording is here:
https://roddavid10.mitel-nhwc.com/join/tybfymv
Pre-close view… Trying to come off a low note.
Lower and lower lows may have stopped their downtrending.
Sellers started gaining traction, but weren”t confirmed. The bias environment”s 2068.00 exit was under the noon hour”s 2072.50 low. But despite having extended down to 2061.25, the final hour”s entry was overlapping the bias environment”s 2066.00 low.
The 3:10-3:20 timing window didn”t confirm or reject, so it”s too late for any action today to be predictive for Thursday”s session.
Is it too late to start trending back up? An 8-point bounce is now slipping back as the 3:37-3:52 position-squaring window starts opening. Back under 2066.00 would likely target fresh lows at 2058.50. But that would still be too late to influence tomorrow”s session.
If not delayed much longer, back above 2070.25 could add another 8-9 points before the close.
Daily Spot… 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 Jun Contract (EC, ETF: (FXE, UUP))
The rally”s 1.1380 was tested at least to within 3 pips Wednesday afternoon. The next higher significant targets would be 1.1545 and 1.1700. Pullbacks meanwhile have room down to 1.1225-1.1280 without yet reversing momentum down.
Gold Jun Contract (GC, ETF: (GLD))
An overnight dip back to an 1187.00 handle was recovered entirely Wednesday morning, but that was soon retraced. At least the 1194.50 bounce limit held, but 1187.00 was broken to reinstate the decline.
Silver Jul Contract (SI, ETF: (SLV))
Narrow sideways ranging Wednesday held the 16.50-16.65 range instead of trending, seemingly waiting out Gold completing its pattern.
30-year Treasury Jun Contract (US, ETF: (TLT))
Sharply lower lows Wednesday attacked the next lower target at 154-02 to within 1 tick. Perhaps that would suffice, but the reaction was muted and almost irrelevant, so a lower low at 153-10 is now possible. Back above 154-26 would start to suggest a bottom is forming.
Crude Oil Jun Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Testing and rejecting both the 61.75. and 62.50 targets almost simultaneously — on the same day, anyway — creates heavy resistance. Not that it won”t be retested, but its retest is likely to hold. Closing any higher would get every benefit of the doubt for extending higher. But the near-term likelihood is a corrective dip.
Natural Gas Jun Contract (NG, ETF: (UNG, UNL))
.Wednesday”s shallow reaction down was recovered entirely to retest Tuesday”s high. But the rally didn”t extend. Thursday”s EIA report is being greeted from a position of strength for being in an uptrend. But it is vulnerable to an initially negative knee-jerk reaction down since the 2.80 target has been met and held, the confirmed breakout”s minimum third higher close was fulfilled already, and there hasn”t been a deep correction.
Still digging.
Afternoon probing fresh lows.
This morning”s bias environment was exited at 11:30 under its 2080.50 bias-down signal. Recovering it into the noon hour would have qualified as rejecting its outstanding 2069.75 renewed bias-down target. A bounce tested 2080.50, but only by 3 ticks and no higher than its first 3 minutes before entering the noon hour below it.
2069.75 was just met. It”s this afternoon”s bias-down target, and it”s being probed down to 2067.00.
This morning”s price action is the best example of what I was referring to over the past couple of weeks, when I have noted the price behaviors suggesting an opportunity-rich environment is coming.
Here”s an opportunity to test whether that environment has arrived. Big intraday swings means just that — swings. Having swung down, fulfilling targets, with RSI diverging positively, a significant rally is possible.
Back above 2070.25 and 2076.50 could extend into positive territory. Today. But either one or both that touched must then be exceeded coming out of the bias environment to maintain the recovery. Otherwise, the trend remains down, next targeting 2064.00-2064.75.
Look ahead: Economic Calendar – for Thu May 6 2015
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights:
Thursday”s reports are barely high-profile, and only Claims has any track record of influencing price, but that is old. GBR”s elections might generate a reaction for the outcome being unknown since polling is so close, but close US elections haven”t triggered much reaction themselves. Thursday”s most influential report isn”t even listed, because it”s not released until before Friday”s open, and anxiousness ahead of it might inhibit trending.
UK General Election results
Challenger Job-Cut Report
7:30 AM ET
*Jobless Claims
8:30 AM ET
Gallup US Payroll to Population
8:30 AM ET
Bloomberg Consumer Comfort Index
9:45 AM ET
EIA Natural Gas Report
10:30 AM ET
Consumer Credit
3:00 PM ET
Fed Balance Sheet
4:30 PM ET
Money Supply
4:30 PM ET