S&P
Morning Bias
| FRI morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2733.00 | 2732.50 |
| …would target | 2740.75 | 2740.50 |
| Bias-down: under | 2720.00 | 2719.75 |
| …would target | 2710.75 | 2710.25 |
| Signal status: LATE BIAS-UP | FAQ | |
| NEW! Flowcharts: Bias-UP // Bias-DN INTRO VIDEOS #1 and #2 |
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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)
Thursday’s gap up above the morning’s 2713.50 bias-up target could have resolved a lot of ways. Exceeding it in time would have renewed the bias-up signal. Reversing down from it and under the bias-up signal would have targeted both bias-down parameters.
But something in between — like Thursday’s opening pattern — was likely to test the 2703.00 bias-up signal as support and either hold it or recover from probing under it. 
And having probed under it 2788.50, the pattern would likely reward its buyers with a fresh session high above 2717.50-2719.50.
That’s two sizeable moves being signaled before noon, and the session kept giving.
The fresh high promised by the second signal also triggered the afternoon’s 2712.50 bias-up targeting 2725.00. It was probed by nearly 4 points before testing a sell signal down to 2719.50. But fidgety shorts overwhelmed the position-squaring window which surged 10 points into the cash session close and added 3 more into the futures close.
The second consecutive higher close above 2684.00 makes 2753.00-2757.00 even likelier. The WedEX is unaffected and remains intact, likely to influence Friday afternoon and Monday morning bullishly. Meanwhile, a second consecutive afternoon has refused to exploit an opportunity for the rally to rest on its laurels and refuel by trapping shorts, keeping alive the potential for another pullback first.
- 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))
Fulfilling the bounce’s minimum 1.2435-1.2465 target area Wednesday didn’t prevent probing higher overnight and gapping up Thursday to test 1.2540. There is potential for extending to fresh highs so long as 1.2435 now holds as support.
Gold Apr Contract (GC, ETF: (GLD))
Already having fulfilled the minimum 1356.00 objective — i.e. filling its gap above — was extended overnight to attack 1360.00, but Thursday traded flat-to-lower down to the rally’s 1350.50 pullback limit.
Silver Mar Contract (SI, ETF: (SLV))
The rally’s 16.95 target was met at the overnight high, making the pattern more vulnerable to reacting down more obviously. Which the gap down did, extending to 16.60 at session lows. Closing back above 16.70 would reinstate the upside momentum next targeting 17.11.
30-year Treasury Mar Contract (US, ETF: (TLT))
Wednesday’s retest of Sunday night’s 143-04 target had originated from a position of strength, so Thursday’s bounce back to what is now the buy signal at 144-12 is starting to suggest a bottom is forming.
Crude Oil Mar Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Fresh highs overnight probed the 61.50 bounce limit by a nickel before reversing down sharply to 59.80 support. Its reaction back up above Wednesday’s highs must be the corrective bounce’s peak and launch the next downleg targeting 57.20 to maintain the pattern.
Natural Gas Mar Contract (NG, ETF: (UNG, UNL))
Filling the gap Wednesday back down to Monday’s 2.56 close prevented greeting Thursday’s EIA report from a position of weakness. But its resolution wasn’t high enough to reach a position of strength. A blip-down overnight touched 2.53 but the session only ranged narrowly without resolving either way.
Mid-day Update… Fresh highs, and Bitcoin target met.
Morning drop recovered to probe overnight highs.
This morning’s 2703.00 bias-up signal triggered without being touched post-open. But having held a test of its 2713.50 bias-up target, the balance of the window was likely to test the bias-up signal as support. This template is standard, and I describe it in great detail this morning here.
Anyway, probing under the bias-up signal had required retracing 2703.00 before an actual drop would be credible. No actual drop was required. The retracement would be free to actually resume the overnight rally, or at least to retest the 2719.50 overnight high.
2703.00 was probed down to 2688.50, indicating a buy signal back above 2700.00. It triggered, and the overnight high was probed up to 2721.00.
Structurally, the fresh high is the minimum reward for having absorbed the probe under 2703.00. Meanwhile, this afternoon’s 2712.50 bias-up signal has triggered, putting into play its 2725.00 target. A pullback is now trying to hold 2712.50 as support, and back above 2717.00 (being tested now) would start signaling its success. Dipping under 2711.50 would be difficult to recover today.
BITCOIN. I described a pattern developing this morning that suggested the hesitation upon approaching 10,000 would lead to a surge through it, and THEN a more substantial pullback. The surge is now developing, and my mid-morning update in the chaRTroom noted its minimum target is 10,225 where I would begin selling. Piercing the target by $22 is reacting down sharply, already $100 points to 9,945. Curiously, ETH and LTC didn’t participate to the upside.
Look ahead: Economic Calendar – for Fri Feb 16, 2018
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: Friday’s Consumer Sentiment is high-profile and influential to price action. Perhaps more so this week, especially if it contradicts the week’s earlier consumer data or confirms any outliers.
Housing Starts
8:30 AM ET
Import and Export Prices
8:30 AM ET
*Consumer Sentiment
10:00 AM ET
E-Commerce Retail Sales
10:00 AM ET
Baker-Hughes Rig Count
1:00 PM ET