S&P
The First Trade & Pre-open Tour Recording… Overnight chop.
Proper context can start the day with a solid win and make all the difference.
DAILY SCHEDULE
First, watch the pre-open Tour recording HERE <<==
Then, meet in the chaRTroom here by 9:15 ET for updates and Q&A
Through the prior close…
Sunday night’s action had promised an active session, and Monday didn’t disappoint. The overnight gap down to 2774.00 had been recovered to fluctuate around Friday’s 2782.50 close up to 2786.50, greeting Monday’s open above prior highs at 2784.00. Having escaped last week’s pattern of rejecting early fresh highs — or, at least, absorbing the pattern when it developed overnight — the morning did almost nothing. Actually, the morning did do one thing, ranging up to 2788.50, before the noon hour extended to 2794.25. No traction was gained during the afternoon, leaving the final hour to fluctuate narrowly sideways. A very late break under 2790.00 collapsed quickly to 2784.00-2785.00, but its timing was too late to be predictive, if it’s even sustainable.
Overnight action’s new info…
The late break proved to be temporary — three times. It was recovered completely soon after the Globex open, back up to Monday’s late sell signal at 2790.75. And then another collapse retested the 2784.00 low. Another recovery was also retraced by another collapse. Yet another recovery finally probed a fresh high up to 2792.00 into Europe’s opens. That’s three recoveries, but now fresh lows are probing yesterday morning’s low down to 2782.50. This leg isn’t a collapse, and there’s no current attempt to recover it.
If, then…
Yesterday’s 2794.25 high tested and held the rally’s next higher objective of 2793.00. There’s room for noise above it that could be tested by another recovery of yesterday’s late drop. But there’s no requirement for another recovery of yesterday’s late drop. This area is the last opportunity to end a correction before starting to require new all-time highs. Regardless, last week’s distribution and rotation out of leadership still threaten to repeat its pattern of rejecting a probe above the prior session’s highs — and a probe above the prior yesterday’s highs would be the likely objective of any post-open rally. Otherwise, even the most bullish longer-term scenario isn’t precluded from launching a pullback here, which is already underway if the open isn’t rallying.
First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 above 2793.00 would be likely to trigger the 2790.25 bias-up signal at 10:15. Exiting the open under 2788.00 would be unlikely to trigger bias-up. Exiting the open above 2787.00 would be unlikely to trigger the 2782.00 bias-down signal.
Morning Bias
| TUE morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2787.00 | 2790.25 |
| …would target | 2794.00 | 2797.25 |
| Bias-down: under | 2778.50 | 2782.00 |
| …would target | 2772.00 | 2775.50 |
| Signal status: LATE NO-BIAS, TESTED BIAS-UP SIGNAL | FAQ | |
| Flowcharts: Bias-UP // Bias-DN 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.
Market Wrap (recording & summary)
Sunday night’s gap down to 2774.00 was recovered to fluctuate around Friday’s 2782.50 close up to 2786.50. Monday’s open was greeted at 2784.00, where the morning fluctuated up to 2788.50. Trending into and out of the noon hour extended to 2794.25.
The rally’s next higher objective at 2793.00 was tested, and held. The response to it wasn’t very reactive, dipping only to 2789.50, not even touching the morning’s high. (The position-squaring window did break a 2790.00 sell signal and collapse quickly to 2785.00, but that came too quickly to be predictive.) The morning’s post-open low also narrowly avoided touching Friday’s high. All of which is a degree of optimism — not excessive optimism, but enough to be wary of a coming downdraft.
Holding 2793.00 merits being wary of a coming reversal. It’s essentially the highest objective that doesn’t start making new all-time highs any likelier. There’s room for noise above it since it has actually been touched, but not much room. And there’s still a pattern of rejecting early probes above prior session’s highs.
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 Jun Contract (EC, ETF: (FXE, UUP))
Sunday night’s bounce almost threatened 1.1835 whose recovery would make another downleg unlikely soon. Otherwise, back under 1.1745 could still trigger, and would target the low’s gap fill under 1.1550.
Gold Aug Contract (GC, ETF: (GLD))
Three consecutive tests of 1305.00 have yet to reverse down, despite Friday’s pause. And now Monday has produced a fourth test of 1305.00, also touching the 1307.00 buy signal. Back under 1296.50 would signal the trend reversing down.
Silver Jul Contract (SI, ETF: (SLV))
Already rallying Sunday night to within 3 cents of fulfilling the 16.30 target suggests that Thursday night’s dip to 16.65 was the extent of a correction. Back under 16.80 can now break lower to target 16.55.
30-year Treasury Sep Contract (US, ETF: (TLT))
Gapping down Monday to test 142-22 as support can extend down to also test 142-00, and still be likely to recover and also to resume the rally.
Crude Oil Jul Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Monday’s gap down was recovered back to Friday’s close, and then into positive territory. Without closing above 66.25 Monday, its immediate recovery and extension through 67.50 would be optimal to confirming a new rally leg underway.
Natural Gas Jul Contract (NG, ETF: (UNG, UNL))
Sunday night’s gap up extended through Monday’s open, to test 2.95 whose recovery would confirm Friday’s dip back to support was only a temporary detour, and the requirement for at least a close above 3.00 remains intact.
Mid-day Update… Prove it.
Testing big resistance, or breaking it?
This morning’s noN-bias environment wasn’t required either to extend or to reverse, so it did neither.
Or both. Whatever it did was noise, lacking sponsorship that would have signaled its intent at either 10:15 or 10:30.
But the overnight rally had resumed when the bias environment began lapsing at 11:30. It was already firming when the bias environment lapsing lapsing came within view 10-15 minutes prior. A sell signal at 2784.25 was only touched but not triggered, and then became the launchpad to testing 2793.00 during the noon hour.
Probing this afternoon’s 2793.00 bias-up signal by 1 point at the noon hour’s 2794.00 high still didn’t trigger it. In fact, once again today has triggered nonN-bias. So, there’s no requirement to extend or to reverse, or not to.
In addition to being this morning’s bias-up target, and this afternoon’s bias-up signal, 2793.00 is a relevant objective of the rally. Last week’s pattern of reversing down from fresh highs is still influential, especially after having held another bias-up signal touch like last night. A dip back into this morning’s range at 2786.00 can’t be discounted. breaking under this morning’s range probably can’t be recovered.