S&P
Post-open Review… Threading the needle.
Triggering then un-triggering bias-up.
Pullin
g back into the open from 2682.25 to 2674.50 was sufficient to correct the earlier overnight gains. We know that because the open surged, extending to attack 2682.00.
Interestingly, the price action seemed to be ignoring or at least compartmentalizing an ominous announcement from Israel regarding Iran. Apparently, that became impossible when crude oil had popped too much.
Eventually, price had reversed down to 2671.75. I’m assuming it’s a reaction to non-market news which is likely to be recovered. But that’s in contradiction to the 2678.25 bias-up signal failing to trigger, putting into play an offsetting test of its 2662.25 bias-down signal.
A reaction up to 2679.00 is trying to rally, anyway. Which it can, even with the objective outstanding below. Exiting the bias environment above its 2684.25 bias-up target would invalidate that objective below, but it can become “unfinished business.”
Back above 2679.00 would put higher highs back into play. Otherwise, another dip under 2673.00 would reinforce the 2662.25 objective, or something substantially lower this morning on the along that path.
The First Trade & Pre-open Tour Recording… IMPORTANT PROGRAMMING NOTE.
SITE REDESIGN: You may might notice some minor aesthetic changes when logging in today. There’s a little more serious stuff happening on the back-end which shouldn’t effect you. Regardless, please contact me ASAP if you encounter any difficulty accessing any part of the site the way that you want to access it. Thank you!
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…
Friday’s open was greeted by sideways ranging that never probed Thursday’s test of 2677.00 resistance, but also not rejecting it. Post-open action didn’t probe higher either, never stretching the rubber band. So, a drop to 2658.00 lacked the momentum of a rubber band snapping back. The drop was retraced almost as quickly. The balance of the session copied the overnight pattern and ranged sideways, never probing 2677.00 resistance, but also not rejecting it.
Overnight action’s new info…
A delayed open seemed to have a lot of pent-up buying pressure. Spiking up 9-10 points from Friday’s 2669.00-2671.50 close was retraced quickly. Then it was recovered gradually. And extended, for awhile. Attacking 2681.00 was later improved to 2682.25, and its reaction down is attacking the 2677.50 interim low.
If, then…
Without rejecting the ongoing test of 2677.00 on a timely basis, fresh highs became more possible. Now they’re being tested, above 2681.00 and not quite attacking 2684.25. Fresh highs are still vulnerable to reversing down, albeit a little less so, and probably not if maintained much past noon. Extending higher would target 2693.00 and 2703.00.
First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 above 2681.00 would be likely to trigger the 2678.25 bias-up signal at 10:15. Exiting the open under 2674.00 would be unlikely to trigger bias-up.
Morning Bias
| MON morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2679.50 | 2678.25 |
| …would target | 2685.50 | 2684.25 |
| Bias-down: under | 2663.25 | 2662.25 |
| …would target | 2656.00 | 2655.00 |
| 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)
“The cart won’t go before the donkey’s hooked up,” as my make-believe Great-great Grandpappy would have said back in the day. Friday he would have said that a rubber band can’t snap until it’s stretched. Which is what happened to the bearish scenario. Or, more appropriately, what didn’t happen to it.
Probing fresh highs Friday above the 2677.00 corrective bounce limit would have been likely to reverse down throughout the afternoon. Fresh highs weren’t probed, perhaps because Thursday’s surge into the futures close did, after all, fulfill the traction gained by its intraday rally. Perhaps the NQ sell-off siphoned the day’s selling pressure, having probed above Thursday’s high before plunging through the afternoon.
Nevertheless, the ongoing test of 2677.00 wasn’t rejected, so fresh highs are still possible. And fresh highs are still vulnerable to reversing down, albeit a little less so. Extending higher would target 2693.00 and 2703.00. Oversold RSIs at Friday morning’s 2657.75 low will require a retest at some point, too.
Details and other markets coverage are discussed in the post-market Wrap recording here.
I’LL EMAIL THE LINK TO SATURDAY REVIEW IN THE MORNING.
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))
Friday’s gap down to test 1.2100 was recovered through the morning to fill the gap back up to Thursday’s 1.2145 close. Friday’s open is under all prior lows, so it will need to be filled before a durable recovery would be credible. An immediate interim bounce has room up to 1.2215.
Gold Jun Contract (GC, ETF: (GLD))
Thursday’s 1316.00 low wasn’t probed Friday, which bounced within Thursday’s range up to 1325.00. There’s room up to 1329.00 while still being likely to resolve down, next targeting 1294.00.
Silver Jul Contract (SI, ETF: (SLV))
[Rolling coverage forward to Jul, which trades at a 5-cent premium to May]… Firming initially Friday touched 16.55 resistance before reversing back down to the 16.45 sell signal. At least a probe lower is now obligatory, while a confirmed break would launch a new downleg. Closing back above 16.75-16.80 — preferably after an intraday probe under 16.45 — would trap this recent weakness and launch a new upleg.
30-year Treasury Jun Contract (US, ETF: (TLT))
Thursday’s bounce was extended overnight to test the 142-25 buy signal, which was probed Friday up to 143-09. Further upside potential up to 143-17 and 144-28 — or just closing under 142-06 — would still be likely to resolve down to 141-04.
Crude Oil Jun Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Extremely narrow ranging around unchanged Friday is already unattractive for trading. Meanwhile, the pattern is developing at its range’s midpoint, making it even more difficult to anticipate the next move’s direction.
Natural Gas Jun Contract (NG, ETF: (UNG, UNL))
Far from being confirmed by a second consecutive higher close, Thursday’s fresh high close reacted down overnight to gap down Friday at 2.80 well under prior highs. Extending down to 2.77 only threatened the 2.76 sell signal, which must still trigger to reinstate the distributive pattern.