S&P
Market Wrap (recording & summary)
Neither of Wednesday afternoon’s bias signals was even attacked before triggering no-bias. But the morning’s retracement continued firming and attacked the 2752.00 bias-up signal to within 1 tick. Would it have broken higher, if not for rumors of US announcing withdrawal from Nafta?
Already reacting down 2 points, the headline triggered a drop that ultimately tested the 2745.25 bias-down signal by 4-5 ticks. The drop began early enough to attract strong-handed reinforcements, but never did.
Wednesday afternoon’s drop was retraced almost entirely up to 2751.00 through the futures close. Expending buying pressure during that otherwise irrelevant window suggests that buyers are weak-handed. Gapping up to trigger bias-up Thursday would at least retest Tuesday’s highs, but otherwise another downdraft would target 2730.75.
- 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))
Tuesday’s confirmation of Monday’s breakout made Wednesday’s gap up premature for resuming the rally, as at least one more lower close under 1.1960 is now required.
Gold Feb Contract (GC, ETF: (GLD))
Rallying sharply to test 1328.50 on the China / Treasuries news was isolated as Wednesday’s regular open had retraced already back under Friday’s 1324.00 prior highs. A fresh high close would still be credible for extending, but now another test of 1308.85 would be much likelier to reverse down.
Silver Mar Contract (SI, ETF: (SLV))
Wednesday’s gap up immediately reversed down to test unchanged as the China /Treasuries news wore off. Closing back above 17.20 would still be credible for extending higher, but closing under 16.95 would be that much likelier to reverse the trend down.
30-year Treasury Mar Contract (US, ETF: (TLT))
Tuesdays’ sharp break under 151-16 to new lows was extended down sharply overnight on the China /Treasuries news. Despite rallying out of the 149-03 open, just closing negative has confirmed Tuesday’s breakout and now requires an eventual third lower close. Meanwhile, the gap down under all prior lows also wants to be filled before a recovery would be credible.
Crude Oil Feb Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Gapping to new recovery highs Wednesday was resisted by 63.52 as the session hovered narrowly. Pullbacks now have room down to 62.15 to maintain the 64.25-64.75 target.
Natural Gas Feb Contract (NG, ETF: (UNG, UNL))
Probing higher overnight to attack 3.00 didn’t prevent Wednesday’s flat open or further retracing back down to the 2.86 buy signal. Thursday’s EIA report is being greeted from a position of strength for the breakout, with restrained optimism for having corrected back to support. A second consecutive higher confirming close would have been stronger, but a favorable reaction or recovery from an unfavorable reaction is likely.
Mid-day Update… Between a soft rock and a not-hard place.
Recovery ranging between obligatory levels.
The open’s plunge back to and through overnight lows was recovered entirely during the morning bias environment. Down from 2746.75 to 2736.50, and back up to 2748.50. Flat-to-higher ranging since then eked its way back above yesterday morning’s 2748.00 lows to attack yesterday’s 2750.75 close.
2748.00 and 2750.75. Not quite the proverbial “rock and a hard place.” But still relevant support / resistance whose recovery or rejection through a relevant window would be likely to extend in that direction.
Back under 2746.50 would start to signal another downleg underway targeting 2730.75. There’s otherwise no requirement to trend any more for the balance of today — or tomorrow morning, either, if the balance of today hasn’t ranged away from 2748.00 and 2750.75.
Look ahead: Economic Calendar – for Thu Jan 11, 2018
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: Thursday morning’s pre-open PPI is both high-profile and influential to price action. The afternoon’s 30-year auction usually inhibits trending before its results, and then triggers a relief rally afterward. The late-afternoon timing of another Fed speaker is unusual, and could be a catalyst to keep things interesting into the close.
Jobless Claims
8:30 AM ET
*PPI-FD
8:30 AM ET
Bloomberg Consumer Comfort Index
9:45 AM ET
EIA Natural Gas Report
10:30 AM ET
*30-Yr Bond Auction
1:00 PM ET
Treasury Budget
2:00 PM ET
*William Dudley Speaks
3:30 PM ET
Fed Balance Sheet
4:30 PM ET
Money Supply
4:30 PM ET
Afternoon Bias
| WED afternoon signal (triggered at 1:20 ET) | SPX | ES |
| Bias-up: above | 2751.00 | 2752.00 |
| …would target | 2756.50 | 2757.50 |
| Bias-down: under | 2744.25 | 2745.25 |
| …would target | 2738.75 | 2739.75 |
| Signal status:NO-BIAS | 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.