S&P
Market Wrap (recording & summary)
Friday and Monday’s drops did it. Tuesday and Wednesday’s intraday rallies did it. Thursday morning’s two choppy consolidations and their breaks lower did it. And now Thursday afternoon’s last two hours have done it.
Done what? Each of these two sequential setups have expanded their bearish aspects. Their second act — be it an intraday decline, or a rejection of resistance, or distributive range — all measured greater than their first.
Selling pressure is growing, which requires its rejection to avoid capitulation. Rejection is often achieved, by gapping up above a relevant level. This current series seems unable to do that. And Thursday’s two sets extended to sharply lower lows that make it extremely difficult to reject at the next open.
Gapping up sufficiently above a prior high Friday would be credible for reversing the trend up into the close, where Friday Factors could create a bigger rally. Otherwise, those same influences can extend the decline to sharply lower lows into the weekend.
- 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))
Wednesday’s dip back into last month’s 1.2260-1.2300 range was extended to its lower-end Thursday. Still overlapping Wednesday’s 1.2275 close does undermine whether Thursday produced a fresh low close that would fulfill the confirmed breakout.
Gold Apr Contract (GC, ETF: (GLD))
The next lower objective at 1312.50 down to 1309.00 reacted up Thursday to test 1324.50, avoiding a close under 1312.50 that would have put into play much lower objectives .
Silver Mar Contract (SI, ETF: (SLV))
Thursday’s low came within a nickel of touching the next lower objective at 16.15. Its reaction tested 16.60 but didn’t reverse the trend up, so 16.15 remains outstanding.
30-year Treasury Mar Contract (US, ETF: (TLT))
Thursday’s 143-20 low could fulfill the required third lower close in-play from the recent confirmed breakout. The 144-12 prior relative low shouldn’t be recovered first.
Crude Oil Mar Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
The 61.50 target that was met and held Thursday was probed Thursday down to 60.60. Back above 62.30 would launch a new rally leg. Otherwise, extending to fresh lows would next target 59.80 and 57.25.
Natural Gas Mar Contract (NG, ETF: (UNG, UNL))
Still ranging narrowly at pullback lows around 2.70 Thursday doesn’t prevent a close back above 2.86 from launching a recovery.
Mid-day Update… Objects in the mirror are smaller than they appeared.
Selling pressure is growing.
The wide, choppy open took its time before finally triggering late bias-down under 2674. The 2651 bias-down target was quickly met, launching another choppy range into noon. 
That choppy range was choppier than the open.
Then trending resumed, attacking 2613 before the noon hour ended. That 45-point downleg was bigger than the earlier 33-point downleg that had fulfilled the bias-down target.
In other words, the downward gyrations are expanding.
That has become the theme this week. One might even call it a “pattern.” Tuesday’s bottoming pattern was the culmination of Friday and Monday’s downward expansion. And this morning’s drop followed Tuesday and Wednesday’s expanded distribution at resistance. Either setup could have been overcome by gapping up enough. As could today’s.
If the decline can pause that long. Which it’s trying to do, extending the bounce from 2613 to 2649. But everything above the ~2641 bias-down signal during a no-bias environment is “no-bias trending” that will require being retraced. That would be problematic to invalidating the intraday selling expansion, if its consequence is already developing today before a gap up tomorrow could invalidate it.
And the consequence of that expansion is to probe under Tuesday’s intraday lows, all but ensuring new lows down to 2509-2511. So, perhaps the only bullish scenario must be sure to retest ~2641 through the bias environment starting to lapse, and then rally sharply into proximity of a gap up tomorrow.
Look ahead: Economic Calendar – for Fri Feb 9, 2018
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: Friday’s econ report is neither high-profile nor reliable for influencing price action.
Wholesale Trade
10:00 AM ET
Baker-Hughes Rig Count
1:00 PM ET
Afternoon Bias
| THU afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 2658.00 | 2655.50 |
| …would target | 2667.00 | 2664.50 |
| Bias-down: under | 2643.25 | 2640.75 |
| …would target | 2634.50 | 2632.00 |
| Signal status: waiting for trigger | FAQ | |
| NEW! 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.