S&P
Post-open Review… Ineffectual optimism.
Flat-to-higher open should be a lot higher.
The pre-open rally pierced the 2646.50 overnight high. Its recovery post-open would have signaled the last dip to 2635.25 had held, and that momentum was reversing up. But its reaction down into the open tested yesterday’s last-minute 2638.00-2639.00 lows.
A blip-up touched the 2643.00 bias-up signal before dipping back into the range. No-bias triggered, putting into play an offsetting test of the 2636.50 bias-down signal. But that didn’t prevent another bounce testing 2643.00.
The bounce came too late to trigger bias-up or to invoke the grace period. And it didn’t improve in time to invalidate the signal. Probing fresh highs now would be “no-bias trending” and required to retrace back down.
Falling to fresh lows would not be required to extend down. But it would be the last opportunity to defend against a bigger decline, since there’s still no “unfinished business above.”
The First Trade & Pre-open Tour Recording… Follow-through?
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 gap up completed the retracement of Friday morning’s headline-triggered plunge. More so, it reacted to the weekend’s tax reform advancement. Wednesday and Thursday’s rally last week already had anticipated the news, so Monday’s 2660.25 open’s 5-point surge probed the overnight high and then promptly collapsed. The drop paused long enough for a bounce to neutralize the open’s gap up, before extending down to the morning’s test of 2651.00. Sideways ranging held several tests of 2657.25 resistance through the afternoon bias environment. Another collapse slid to attack 2638.00 into the close.
Overnight action’s new info…
Monday’s late slide extended through the Globex open to test 2634.00. Firming through midnight reached 2644.50. Consolidating there had started breaking lower into Europe’s opens. A 9-point slide attacked the earlier low to within 5 ticks. The slide’s 61.8% retracement has tested and retested 2640.75, which had been one of yesterday afternoon’s downside targets. And the retest just broke higher to attack the decline’s other target at 2643.00.
If, then…
The attack on last night’s earlier low could suffice for its retest, if the open is able to rally above their 2644.50 interim high. Otherwise, the next lower objective is a test of 2631.75, which had been an objective of the previous rally. Its recovery was pretty significant, as the next higher objective above 2631.75 was 2657.25, and it has held both of its intraday tests. More so, each test of 2657.25 has been reversed to close under its 2651.00 room for noise. This is distribution. So, closing back under the 2631.75 previous objective would essentially seal a top — not necessarily reverse momentum down, but confirm that a downleg is forming. Similarly, 2631.75 can be tested and probed intraday but still recovered through the close to avoid sealing a top, robbing sellers of traction and enabling another bounce to at least 2651.00.
First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 above 2644.75 would be likely to trigger the 2643.00 bias-up signal at 10:15. Exiting the open above 2638.00 would be unlikely to trigger bias-down.
Phonetic dictation…
good morning and welcome it is Tuesday it’s time for Tuesday’s Morning Market or kind of looks like a sideways range overnight let’s compare that to yesterday’s clothes yesterday is closed which basically came in 2638 3850 and that was after having Consolidated Redrum 39 or down to 39 3875 then the very last minute blip down to 38 extended that immediately into the Globex open and then bounced bounced in the midnight that’s not really a rally more so firming lack of selling pressure suddenly not really any sponsorship here double top there and then started selling off again into Europe’s open so we’re going to express whatever us markets had expressed yesterday and their initial Gap up a relief rally on the tax reform advancement but really just we testing last week’s high of a two-day rally that had already pretty much discounted anticipation of that event and trended straight down from there pretty much so Europe gets it out of their system as well as suspect at least for now or I suppose the rat race meant if this were very satisfied with this degree of an attack on the low anything lower then 3525 versus the actual 3375 Arley Arlo anything lower would have required actually probing under the 175 3175 or the actual Target but remember 3175 3175 was basically above 2601 and above 3175 was 5725 which has been tested twice and both times failed to close above 51 or around 5725 so after that after break 5725 and yet failing to maintain to the 51 closing back under 3175 with essentially seal the top for that reason I can’t I can’t advise anticipating or expecting that 2631 75 will actually break lower lot of Defense there a lot of Defenders are there and it’s been pretty much straight down from testing retesting 5725 757 we’re not going to worry about the clothes until the end is coming or at least back to 5725 at the least relevant I was just attacked after hesitating hesitatingtire shop signal so there’s no attempt the markets in proximity to actually triggered by ASAP and rely on this retest of the earlier low to get out of the open above the interim High 4450 and Trigger the bias up signal 43 at 10:15 its in proximity to do that and if they can’t do that there’s something wrong with the upside 3175 4075 can’t be recovered let alone 43 3075 is a very likely objective any questions let me know quickly activity gold and silver silver a little bit lower as it still has this obligatory bounce off of Friday’s low that just was too shallow 2 in need of actually being probed long Bond still not exploiting and it’s still not exploiting that Friday and probe substantially or probe to prioritize I need to get this stuff transferred over 154 basically a premium or discount in March from December but I got no reason to the Buy Signal that was finally probe considerably but stopping at least fill in the Gap back to the prior high and yet we’re dipping even deeper overnight has to close by 5748 to maintain the upside momentum natural gas going on even deeper to its 287 Target. Just the Gap outstanding but 287 on its retest even deeper overnight and that’s after yesterday held the 310 312 opening test overnight test actually bouncing even further is it going to get this 76 basically 7655 out of the way corrective bounce there are some other developments confirm Friday’s break out yesterday for the second consecutive hasn’t prevented extending a little bit higher Bank of Canada does have a policy statement coming out this week much more so support apparently and yesterday stillthey can work out but it’s just not high probability enough and the recording here is whatever was going on around 4075 he is trying to settle its way back up greet the open and rally mode and we could have we can have a pretty significant rally underway somewhat of a running correction here yesterday afternoon maybe a little too congested but still get past any congestion through the open and bigger retracement of the prior leg or downleg would be possible any questions good luck today.
Morning Bias
| TUE morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2643.25 | 2643.00 |
| …would target | 2648.50 | 2648.25 |
| Bias-down: under | 2636.75 | 2636.50 |
| …would target | 2630.75 | 2630.50 |
| Signal status: NO-BIAS, TESTED BIAS-UP SIGNAL | FAQ | |
| NEW! 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)
Sunday night was greeted by a relief rally on tax reform advancing over the weekend. Monday’s open offered the intraday crowd an opportunity to express a similar sentiment. But Wednesday and Thursday’s rally last week already had anticipated the news, so rallying Monday morning was likely to reverse down. Which it did.
We patiently awaited a break either way of the overnight sideways range. The first spot to fade it followed the first detached tick from testing 2663.75 by 6 ticks. Its reversal down touched last Wednesday’s high to become relevant, so that its bounce could neutralize the 2660.25 open. Suddenly, there was no “unfinished business above.”
The morning’s 2651.00 low launched another sideways range attacking 2658.00 through the afternoon bias environment. Multiple opportunities to rally were ignored, and it wasn’t long before learning why — the bias environment exit resumed the decline. Another collapse slid to test 2639.00, where the balance of the session hovered until a last-minute blip to 2638.00.
Monday is the second session to have tested the rally’s 2657.25 objective. And both of its tests have closed back under 2651.00. This suggests distribution. Meanwhile, continued underperformance by NDX and outperformance by the Dow suggests big money rotating out of speculative and into safety.
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 Dec Contract (EC, ETF: (FXE, UUP))
Friday’s reaction down from 1.1930 probed under 1.1860 Monday, but not yet decisively enough to be reliable for resuming the decline.
Gold Feb Contract (GC, ETF: (GLD))
Monday’s gap down deeper back into Thursday’s range confirms that Friday morning’s recovery attempt did fail. Closing back above 1288.00 would still be credible for launching a rally.
Silver Mar Contract (SI, ETF: (SLV))
Monday’s retest of Friday’s low not only completed the rejection of Friday’s interim rally, but also stopped optimistically short of probing it which suggests that any near-term strength will fail.
30-year Treasury Dec Contract (US, ETF: (TLT))
Sunday night’s probe back under 153-20 was recovered Monday to at least probe and overlap 154-00. But closing above it decisively is still required to even suggest another rally effort is in-play.
Crude Oil Jan Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Friday’s reaction down from last week’s attack on the 59.00 prior high was extended down Monday to touch the original 57.40 buy signal. There should be little delay in launching another rally effort if the pullback is only temporary.
Natural Gas Jan Contract (NG, ETF: (UNG, UNL))
Sunday night’s rally tested 3.10-3.12 resistance which needed to hold to maintain the 2.87 target. More than just hold, the resistance test needed to be rejected, which it was, by trending back down Monday to a fresh low at 2.96.