S&P
Morning Bias
| THU morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2868.00 | 2868.50 |
| …would target | 2873.25 | 2873.75 |
| Bias-down: under | 2857.75 | 2858.50 |
| …would target | 2851.75 | 2852.50 |
| Signal status: NO-BIAS | . | |
| NEW: BIAS VIDEOS… INTRO // EXAMPLE | ||
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.
Market Wrap (recording & summary)
Wednesday’s close was flat with Tuesday’s 2863.50 close, at least to within 3 ticks. That’s after Tuesday’s close was flat with its open, representing indecision, and classifying intraday price action as distribution.
Wednesday’s open was a little lower than 2863.50. Except for a momentary post-open dip, most of Wednesday’s session developed above 2863.50, making it distribution, too.
And there’s no “unfinished business” above. Again.
Which would be pretty bearish near-term, usually. However, Tuesday afternoon’s slide through the Globex open may have crowded out the organic sponsorship for reversing the trend down. Even the most bearish scenario would have to reward the dip’s buyers with fresh highs above 2874.00 before another downleg could be credible.
Already trending down into Thursday’s open, or reversing a gap up, would be vulnerable to extending down into the weekend. Otherwise, gapping up to and/or through Wednesday’s 2868.25 high would essentially put into play 2883.00.
Details and other markets coverage are discussed in the post-market Wrap recording here.
Monitor overnight Globex trading in the chaRTroom here.
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))
Already having fulfilled both higher objectives Tuesday at 1.1545 and 1.1625, while testing “higher prior lows” from the decline, trying to probe higher overnight to 1.1645 wasn’t likely to extend Wednesday. Its reaction down Wednesday morning didn’t actually reverse the trend down, however likely that may be, and extending the rally would next target 1.1705.
Gold Dec Contract (GC, ETF: (GLD))
Tuesday’s close above 1195.00 extended higher overnight and gapped up Wednesday to test the next higher resistance at 1207.50. Reacting straight back down through the morning filled the gap back down to Tuesday’s close. Back under 1191.50 would reverse the trend back down, but there’s otherwise room up to 1215.00-1220.00.
Silver Sep Contract (SI, ETF: (SLV))
Probing the 14.63-14.80 range’s upper-end overnight was retraced into Wednesday’s open, dipping back into the range, instead of extending to 15.05 above, and still attracted to 14.45 below.
30-year Treasury Sep Contract (US, ETF: (TLT))
Gapping up Wednesday and probing a fresh high wasn’t assured of extending higher. It would likely be at a steep slope, or else the rally would otherwise have peaked. Retracing the intraday fresh high probe back under Monday’s high would be “ineffectual optimism” and more vulnerable to reversing down.
Crude Oil Oct Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Rallying overnight gapped up to fresh recovery highs and extended to test the week-old 67.50 gap up above prior highs, neutralizing its attraction above. Closing above its 67.75 intraday would keep alive the next higher attraction at 68.30.
Natural Gas Sep Contract (NG, ETF: (UNG, UNL))
The attraction back down to 2.85 remains intact so long as the rally back to prior highs isn’t extended Wednesday. Especially on a closing basis, which would greet Thursday’s EIA report from a position of strength. Wednesday morning’s dip back down to prior highs at 2.95 doesn’t create any added strength.
Mid-day Update… Prove it.
Positive territory recovered, and so far, defended.
Holding a test of this morning’s 2857.75 bias-down signal through the open had put into play an offsetting test of the 2866.25 bias-up signal. And probably also 2867.25, potentially 2869.50. The bias-up signal was tested before the bias window began lapsing. Higher highs before noon probed 2 points higher.
Its reaction has dipped back to 2863.00-2863.50. Yesterday’s open and close, this morning’s opening high, and generally support. None of which means it will prevent another drop into negative territory.
My premise during the Market Tour was for this morning to bounce to 2867.25, and then possible launch a second downleg. There’s still no “unfinished business” above. So, not rallying when this afternoon’s bias window begins lapsing, would probably be because another downleg has already begun.
Look ahead: Economic Calendar – for Thu Aug 23, 2018
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: The Jackson Hole convention of Central Bankers begins. Sporadic headlines are likely to have an impact — however brief. Econ reports are meanwhile constant through the open, albeit not very high-profile or reliable for influencing price action.
Jobless Claims
8:30 AM ET
FHFA House Price Index
9:00 AM ET
*PMI Composite FLASH
9:45 AM ET
New Home Sales
10:00 AM ET
EIA Natural Gas Report
10:30 AM ET
Kansas City Fed Manufacturing Index
11:00 AM ET
Fed Balance Sheet
4:30 PM ET
Money Supply
4:30 PM ET