S&P
Market Wrap (recording & summary)
Score one for the anti-bias forces Tuesday. Two, actually. No, wait, one. Or none.
The morning’s rejection of both bias-up parameters 2663.25 and 2671.00 had put into play offsetting tests of both bias-down parameters 2648.75 and 2637.75. The morning met neither before bouncing to fresh post-open highs at 2675.50.
The afternoon triggered no-bias without putting into play any objective. But then its 2663.25 bias-down signal broke, too late to trigger, which is “no-bias trending” that requires being retraced. It wasn’t.
So, both bias setups failed.
Except the afternoon’s no-bias trending extended down to test the morning’s 2648.75 bias-down signal and its 2637.75 bias-down target. Also, exiting the afternoon bias environment under its 2655.00 bias-down target invalidated the no-bias trending and its required retracement.
So, both setups… excused?
The afternoon drop extended down sharply to 2598.75 before I had to leave the screens early for the day. I was skeptical at the lateness of breaking under 2655.00, but that now seems more than a little moot. Closing back under Friday afternoon’s 2650.00 high invalidates the next higher objective it had put into play at 2691.00 — which was already undermined by still overlapping 2658.50 at Monday’s close.
The holiday weekend’s bullish influence doesn’t become effective until Wednesday afternoon, so there’s still a brief window that could see sellers do more damage. And that’s assuming the bullish influence isn’t twisted like the two bias setups described above.
- 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 Mar Contract (EC, ETF: (FXE, UUP))
Monday’s close above 1.2515 prior highs was almost rejected by Tuesday’s gap down under the 1.2480 prior low. But that created a gap back up to Monday’s 1.2530 close, and recovering to close above 1.2480 remains in proximity to filling the gap back up to Monday’s close. Otherwise, closing under 1.2445 would trigger a much deeper reversal down.
Gold Apr Contract (jUN , ETF: (GLD))
It’s premature for gapping down Tuesday to reverse the past week’s rally. That has only created a gap back up to Monday’s 1354.50 close that will want to be filled. However, filling the gap above near-term would remain likely so long as 1341.00 now holds as support.
Silver May Contract (SI, ETF: (SLV))
Closing above 16.65 Monday still needs to recover 16.80 to confirm a new uptrend underway. But like past recent recovery attempts, the upside attempt has been met by gapping down. A sell signal is premature, but not recovering 16.65 Wednesday would start to suggest the next significant leg is down.
30-year Treasury Jun Contract (US, ETF: (TLT))
Another overnight probe under 144-22 — which was a little simpler since Monday’s close was still overlapping it — was followed by another recovery back into the 144-22/145-04 range. Closing beyond either end of the range is likely to extend in that direction, and that resolution is still likelier to be up.
Crude Oil Apr Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Monday and Tuesday’s sessions have both ranged narrowly, and both blipped-up momentarily to attack or to pierce 66.00. Not already rejecting the fresh highs makes higher highs likely, presumably to fulfill the next higher objective outstanding at 66.88.
Natural Gas May Contract (NG, ETF: (UNG, UNL))
The bounce from fulfilling the 2.62 objective extended Tuesday to test 2.70, which is essentially the bounce limit to maintain the downside momentum that is otherwise next targeting 2.52.
Mid-day Update… Tug o’ War
MARKET WRAP WILL BE HELD EARLY TODAY AT 3:03 ET.
Today’s session has been willing to trigger setups. But rather than go on to fulfill them, reversal setups form. And rather than fulfill them, another reversal setup forms. Today’s range isn’t so much range bound, as it is in a tug-of-war battle to influence direction.
The overnight rally only had to maintain through the open for extending the rally to its next higher objective. But the open was greeted back under the overnight rally’s last relative low — 2669.00 — which undermined the rally’s momentum.
The opening dip was deep enough for long enough to reject tests of both bias-up parameters. That put into play offsetting tests of both bias-down parameters — 2648.75 and 2637.75 — but only got to 2652.50. And the attraction below didn’t prevent rallying…
…Rallying to fresh post-open highs into the morning bias environment into its exit. But the 2671.00 bias-up target was still being overlapped, so the morning’s bias-down parameters have become “unfinished business below.”
And now this afternoon’s 2663.25 bias-down signal has held as support to trigger another no-bias. Keeping with today’s new tradition, that didn’t prevent extending down. A pattern had formed that required fresh post-open lows, which are now being probed down to 2650.00 — which is also natural support at Friday afternoon’s high.
We have two competing influences: One is this afternoon’s no-bias environment. Probing under its 2663.25 bias-down signal came too late to trigger. It must be retraced entirely, unless the bias environment is exited under its 2655.00 bias-down target. That would help the other influence, which is this morning’s unfinished business below, at least to 2648.75.
Look ahead: Economic Calendar – for Wed Mar 28, 2018
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: Wednesday’s calendar is busy, especially at 8:30 with multiple simultaneous reports. But none has a reliable track record for influencing price action, not even the only high-profile report — GDP. The late-morning Fed speaker may inject some volatility just before the noon hour.
MBA Mortgage Applications
7:00 AM ET
GDP
8:30 AM ET
International Trade in Goods
8:30 AM ET
Corporate Profits
8:30 AM ET
Retail Inventories [Advance]
8:30 AM ET
Wholesale Inventories [Advance]
8:30 AM ET
Pending Home Sales Index
10:00 AM ET
EIA Petroleum Status Report
10:30 AM ET
*Raphael Bostic Speaks
11:30 AM ET
2-Yr FRN Note Auction
11:30 AM ET
7-Yr Note Auction
1:00 PM ET
Farm Prices
3:00 PM ET
Afternoon Bias
| TUE afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 2676.00 | 2677.00 |
| …would target | 2682.75 | 2684.00 |
| Bias-down: under | 2662.00 | 2663.25 |
| …would target | 2654.00 | 2655.00 |
| Signal status: NO-BIAS, TESTED BIAS-DOWN SIGNAL | FAQ | |
| Flowcharts: Bias-UP // Bias-DN INTRO VIDEOS #1 and #2 |
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1. At 1:20, 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 1:20 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 1:20 would invoke a grace period through 1:30 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 1:30 after invoking the grace period would trigger “noN-bias,” with no bias influence.