S&P
The First Trade & Pre-open Tour Recording… Pressure holding.
Proper context can start the day with a solid win and make all the difference.
NEW 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…
Thursday’s open had firmed to test 2463.00 before resuming Wednesday afternoon’s decline from its 2474.00 high. Thursday’s close retested last Thursday’s 2430.25 overnight lows down to 2427.75 before the close. Trending into the morning and afternoon bias environment exits were predictive in two different ways. The interim bounce was confirmed as being only a correction, leaving no “unfinished business above.”.
Overnight action’s new info…
The intraday drop extended immediately to fill the 3-week old gap back down to my 2425.25 objective, probing it by 6 ticks. The Globex open began firming, and extended up to 2434.00 during Asia’s opens. Hovering for several hours was supported by last Thursday night’s 2430.25 overnight low. But the fear of Europe’s opens started breaking under that range. The break attacked the earlier lows down to 2424.25, which has reacted again by testing 2430.25 as resistance.
If, then…
Gapping up like last Friday isn’t being attempted this near the open, so it probably isn’t going to happen. Probing lower post-open is almost obligatory at this stage of the pattern, having punished last week’s buyers for impatiently preventing a retest of overnight lows. An intraday test of the long-standing 2425.25 is likely, too, and avoiding it would suggest that buyers are behaving impatiently again. Firming is still possible, and likely if an obligatory fresh low is avoided. Firming might resemble stability, but it would be only anxiousness, still doomed to resolve down. The bearish WedEX’s influence this afternoon suggests another interesting day regardless.
First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 under 2431.00 would be unlikely to trigger the 2434.50 bias-up signal at 10:15. Exiting the open above 2431.00 would be unlikely to trigger the 2426.25 bias-down signal.
Phonetic dictation…
good morning and welcome strangest a little bit late 10 or 15 minutes late here so really this will be brief I mean there’s already one possible resolution to yesterday’s big plunge that is off the table I don’t know if you remember yesterday there was a big Plunge is it was set up because the prior week’s pivot reversal session that told us we were heading down and heading down quickly for substantial for multiple multiple sessions for substantial to substantial degree had been retraced starting Monday and retraced in a in the wrong way and other words there were overnight lows Thursday last Thursday night it hadn’t been rested intraday on Friday really nothing that will keep me lative activity Friday and yet all the sudden Monday was gapping up in Monday gapped up and that told us much more certainly that this what even though it already stopped short of its objective 2425 gapping up told us that was very likely a corrective bounce its objectives at least 2463 and if 2463 didn’t launch the next down leg than 2471 7350 basically back here this Gap would be the would be the launch and so actually that Gap was tested overnight last this Tuesday night it was tested intraday on Wednesday and in both cases held and as expected Wednesday and push price back down and then Thursday we’re in this decline so just to point out this is the first day of a break out from a multi-session range Thursday was the first day of a break out from a multi-session range so today has the pressure of potentially being confirmation a break at is interesting but it still needs to be confirmed by a second consecutive lower close today and it isn’t always last week’s was not in fact Thursday was a break out last week as well then Friday didn’t confirm so it has that when we get to similar setups sequentially so two Thursdays in a row with basically plunge Lowe’s they tend to resolve differently so Friday last Friday resolved without probing of French low with a true testing the overnight lows and last night probably little bit lower and then by the way resolved up on Monday this week this Friday unlikely to duplicate last Friday unlikely to avoid retesting overnight lows unlikely to produce lead that is to a quick of rally so that Plunge and any after that there are permutations as well if we if we know or have reason to expect at least an obligatory fresh little because last week already punished so close in such near term memory last week’s aggressive and patient buyers that created at corrective balance already been punished by retracing all the way back down to last week and through last week slows then we’re unlikely to see that activity again which is one reason why I kept up was unlikely also likely to see the overnight Action Pro so it’s going to be difficult to be a buyer without seeing fresh loves without testing also 24 25 24 25 25 the the long-standing objective remember that being the Gap filling but now off to the left here the Gap that was outstanding you can barely see that back here but it’s not quite and town this morning and further this afternoon essentially the burden of proof is on buyers and we’ll be looking for evidence because bounces in this kind of environment can be sharp even if they can be and they can be substantial even if they can peek short of their objectives but the likelihood is down alright any questions let me know.
Morning Bias
| FRI morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2435.540 | 2434.50 |
| …would target | 2441.75 | 2441.00 |
| Bias-down: under | 2427.00 | 2426.25 |
| …would target | 2422.00 | 2421.00 |
| Signal status: LATE BIAS-DOWN, BIAS-DOWN TARGET MET | FAQ | |
| 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)
Thursday’s drop either ended the decline, or took us to the brink of it getting serious.
This week’s overnight and intraday tests of the 2471.00-2473.50 maximum corrective bounce limits essentially reset last week’s drop from its Pivot Reversal session. It was not just one, but two opportunities for the rally’s sponsorship to reassert itself. Neither was exploited, so the correction’s origin below became the next leg’s target.
Reacting down Wednesday was almost required. Extending down Thursday was more than required. Now almost any delay to extending down would be considered sellers refueling. No delay is required, not without gapping up above Thursday afternoon’s 2445.75 high. Any shallower open — gapping or otherwise — would likely resolve down to 2421.11-2425.25 and possibly lower.
There’s even potential for gapping down under 2411.00 and extending lower from there. It was the least likely of the three likeliest scenarios we discussed during the Saturday Review. It’s still the least likely, but likelier than it was at this price last week. That was after Friday Factors, but now they can help.
Also helpful to the decline is the bearish WedEX that had triggered after Wednesday’s close. Whether it plays itself out already Friday morning, or dooms a bounce to failure Friday afternoon, it reqiures fresh lows at some point.
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 Sep Contract (EC, ETF: (FXE, UUP))
Wednesday’s surge back above the 1.1765 sell signal to 1.1800 was in reaction to the FOMC Minutes, and not due to accumulation. The overnight reaction down retraced it all and then some, probing under Wednesday’s lows. The morning’s reaction up held resistance at the 1.1765 sell signal.
Gold Dec Contract (GC, ETF: (GLD))
Surging through 1295.00 after Wednesday’s close in reaction to the FOMC Minutes wasn’t entirely retained into Thursday’s open. The restrained optimism helps to keep alive this leg’s potential to 1305.00. Also necessary is that pullbacks hold 1285.00, which was being attacked as support after Thursday’s gap up.
Silver Sep Contract (SI, ETF: (SLV))
Wednesday’s post-close extension of its intraday rally had extended through the 17.05 pullback limit whose break had enabled the interim dip to test 16.60. Thursday’s gap up dipped to test 17.05 as support. Closing higher Friday would signal the rally leg had resumed.
30-year Treasury Sep Contract (US, ETF: (TLT))
An overnight dip back down to Wednesday’s 154-20 buy signal was recovered Thursday morning back up through 155-10. That is the minimum requirement to resume the rally instead of forming a top. The afternoon extended to test last week’s highs above 155-22, with no bullish excuse to further delay extending sharply higher.
Crude Oil Sep Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Further weakness overnight continued to confirm the 48.25 sell signal, and it 43.50 objective are in-play. The ongoing downtrending of lower lows and lower highs also makes a recovery difficult.
Natural Gas Sep Contract (NG, ETF: (UNG, UNL))
Extending down overnight didn’t greet Thursday’s EIA from any better position of strength. The knee-jerk reaction up tested the 2.91 sell signal, and holding it would keep alive its 2.81-2.82 pullback target. Closing above 2.95 would nevertheless signal further pullback wasn’t necessary before rallying.
Mid-day Update… It’s getting worse.
Now retesting Friday’s range.
The open’s drop to 2449.75 had been recovered to test the 2457.50 maximum corrective bounce limit. It was still being tested as this morning’s 11:30 bias environment exit came within view 10-15 minutes prior. And then it was being tested no longer.
That preliminary window trended down into 11:30, and then trended down more. Strong-handed reinforcements were arriving, helping us to anticipate trending down further still. The noon hour’s entry had probed fresh lows, and the noon hour slid through more of them down to 2440.75.
Now the afternoon’s 2
449.50 bias-down signal has been renewed by not recovering its 2444.25 bias-down target through 1:20. The renewed bias-down targets are 2440.75 and 2437.50. I identified the first before it was met, and price action since then has ranged flat-to-higher.
A corrective bounce could test 2448.00. Exiting the bias environment above the 2449.50 bias-down signal could launch a short-squeeze into the proxy or position-squaring windows. But the gap back to Friday’s 2440.00 close will need to be filled, which would make 2437.50 likely to be tested, too. And there’s still Thursday night’s Globex lows.