S&P
Post-open Review… Room to shrink.
Post-open selling still holding support.
The 2726.25 bias-up didn’t trigger, despite being tested thoroughly during the open up to 2727.75. 
An offsetting test of the 2710.25 bias-down signal is in-play. Usually.
Usually? I’m a little skeptical because all of the bias timing window’s price action through 10:15 was above yesterday’s 2716.25 cash session close. Which was touched twice overnight and held. So, I’ve been discussing my skepticism in the chaRTroom, while also being suspicious that the bias-up signal would trigger.
Bias-up didn’t trigger, and fresh post-open lows were probed… down to touch 2716.25. And as I’m writing, its reaction back up to 2721.00 has extended up sharply to attack the 2727.75 post-open high.
It’s too late to trigger bias-up. And it’s both too late and too early to invalidate no-bias. Exiting the bias environment above its bias-up target would still do that. Otherwise, 2710.25
The First Trade & Pre-open Tour Recording… Restrained optimism.
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 relentless decline had tested the next lower objective under 2745.00 at 2735.00 by 2 points. Retesting it after the opening 15 minutes of volatility prevented it from offering support. The next lower objective at 2726.00-2727.00 was also tested too late, as the morning bias environment was lapsing. And the next lower objectives at 2711.50 and 2706.00 were probed in time to renew the afternoon bias-down signal. Testing the last objective at 2701.50 down to 2697.00-2700.00 was rejected on a timely basis this time, recovering into the final hour. Closing back above 2706.00 and 2711.50 put into play 2726.00-2727.00 which was attacked through the close up to 2723.50.
Overnight action’s new info…
Wide-ranging as it has been, the market has only hovered above yesterday’s late highs. The 2716.25 cash session close was retraced before the late rally resumed. Eventually extending up to 2728.50 ahead of Europe’s opens, also fulfilled the 2726.00-2727.00 objective. Its reaction fell back to 2716.25. That might be an obligatory low, which would make its current reaction an obligatory bounce — a big one, now entirely retraced up to 2728.50.
If, then…
Yesterday’s lows formed a credible bottom, but it can’t afford much hesitation before being productive. The pattern’s minimum objective is already fulfilled, and that is under any prior high whose recovery would signal the trend reversing up. Probing higher overnight does conserve buying pressure, but only temporarily. And still being near recent lows makes it more difficult to absorb another downdraft, so extending the rally without delay would be optimal. Otherwise, the nearest sell signal could be back under 2711.50.
First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 under 2725.25 would be unlikely to trigger the 2726.25 bias-up signal at 10:15. Exiting the open under 2723.75 would be unlikely to trigger bias-up.
Morning Bias
| TUE morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2422.00 | 2726.25 |
| …would target | 2730.75 | 2734.75 |
| Bias-down: under | 2706.25 | 2710.25 |
| …would target | 2697.25 | 2701.50 |
| Signal status: 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)
Only a detour, still a detour, or more than a detour? Those are the most important questions to ask of Monday’s collapse. The answer to at least one of those is “yes.”
Already having tested and retested 2745.00, the next lower objective was 2735.00. It defined Sunday night’s low, but it didn’t hold on a retest. The next lower objective at 2726.00-2727.00 was tested too late to attract counter-trend sponsorship to defend it. So, its next lower objective at 2711.50 and 2706.00 had to be met.
The last objective was actually a test of 2701.50, which was limited to non-relevant timing windows that prevented its break. The tests reached 2697.00-2700.00 before finally ending the downside momentum. And having recovered 2706.00 and 2711.50 through the close, 2726.00-2727.00 was put into play. Post-close action extended up to 2723.50.
Recovering 2735.00 would have signaled the decline was only a detour. Bouncing already to leave a higher objective in-play allows this to still be only a detour, but recovering 2726.00-2727.00 Tuesday must also recover 2735.00. Whether or not first fulfilling 2726.00-2727.00, there’s little excuse for much backing-and-filling before actually rallying — and much more delay to that would suggest something more substantial than a pullback is underway.
- 2700Details 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))
Gapping up a little Monday on news of a Brexit breakthrough still stopped short of the 1.2330 sell signal that was triggered last week, and whose recovery would suggest another bounce underway.
Gold Apr Contract (jUN , ETF: (GLD))
Overnight weakness was retraced Monday to test the 1319.00 signal that had triggered last week to resume the decline. Although the structure containing the 1305.00 gap back down to the lows was tested, the gap itself wasn’t yet filled, which is likelier before a rally can develop — so long as bounces hold 1319.00. And its break would target 1291.50.
Silver May Contract (SI, ETF: (SLV))
Monday’s bounce corrected Friday’s portion of the drop under 16.40, and should be sufficient for the decline to resume if that’s its intent, before actually recovering 16.40.
30-year Treasury Jun Contract (US, ETF: (TLT))
Overnight lows were already testing downtrending support at 144-00 before Monday’s open. Gapping down to the trendline held its test down to 143-27 and quickly reversed up nearly 1 point to probe positive territory. Last week’s confirmed breakout still requires at least one more higher close.
Crude Oil Apr Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Opening back under 62.25 Monday soon collapsed to “lower prior highs” at 61.35, which had been the bounce limit. It was also a test of 51.50 whose break through the close would have been a sell signal, but it was recovered to test 62.25 as resistance into the afternoon.
Natural Gas May Contract (NG, ETF: (UNG, UNL))
Not until after Monday’s open did price spike through 2.70, presumably on its way to fulfilling the minimum lower objective at 2.62. The delayed start reflects an ever-present ineffectual optimism that — from a contrarian perspective — can help to push even lower.