S&P
Post-open Review… Dry Cleaners high?
Little or no interest in rallying.
Global markets weren’t eager to pick up Friday afternoon’s ES rally to new highs. And ES hasn’t been encouraged by its own rally effort. The opening 15 minutes of volatility fluctuated choppily at or under 2456.50 unchanged.
A nearly 4-point surge from attacking the 2454.00 overnight low has gradually improved to touch this morning’s 2459.00 bias-up signal. But it’s too late to trigger, and even too late to invoke the grace period. This is a “no-bias” environment.
Exceeding 2459.00 through 10:30 would have invalidated the 10:15 no-bias signal. Instead, Exceeding 2459.00 now would be “no-bias trending” that is doomed to failure. And having stopped several times pessimistically short of 2459.00 does start to be pessimism, which is potentially bullish from a contrarian standpoint. The limp sponsorship is winning that battle.
Perhaps that’s why the pessimism isn’t being exploited. Meanwhile, not having touched 2459.00 by 10:15 doesn’t have the offsetting requirement of testing the 2453.50 bias-down signal. But there’s room down to it as noise within the range during this morning’s window.
The First Trade & Pre-open Tour Recording… Holding up.
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…
Friday’s opening surge had consolidated above almost all prior highs at 2450.00, and then extended into the last half-hour up to 2461.25. Fulfilling all remaining upside objectives along the way, the rally had one opportunity to entrench itself by the close. And it did, with a new trend high close on a Friday that requires an eventual higher close.
Overnight action’s new info…
Sunday’s open quickly bounced up to 2459.00, which is the bounce limit I had identified at Friday’s close. Narrow sideways ranging eventually dipped to touch 2454.00, which had been the last “unfinished business above” outstanding. Its reaction is now bouncing back up to attack 2459.00.
If, then…
Probing the highest upside objective at 2456.50 Friday was retraced into the close to avoid any hold-long signal. Holding it had opened the door to a near-term pullback to Friday morning’s “lower prior highs” at 2450.00. Holding 2459.00 as resistance keeps that door open this morning, too. Extending higher instead could test 2464.00-2465.00.
First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 above 2460.50 would be likely to trigger the 2459.00 bias-up signal at 10:15. Exiting the open under 2454.00 would be unlikely to trigger bias-up (i.e. holding above 2454.00 through the open won’t marginalize sellers).
Phonetic dictation…
good morning welcome it’s Monday it’s time for Monday’s Morning Market to or not a whole lot to go off talking about here because first of all we did a lot of that on Saturday I hope you had a chance to watch or listen to the Saturday review but basically it comes down to this we had a multi week pull back that ended last week with a gap up that extended for the next day and then Friday morning surged Hubbard pessimistically short of the prior High already two days earlier having indicated that new highs weren’t play it’s so we got their pessimistically short hovering resolved up unfinished business and have been outstanding from the I really wouldn’t have been a deal-killer if it had been left out standing forever but anyway 2454 we were able to calculate levels off of that including 5650 the room for noise about 50 for it was influential and not only influential in a little bit that was soon proved but then retraced close basically at 5650 the room for noise above the unfinished business of self held as resistance which is a big deal also a big deal is a new trend I close on a Friday so with that unfinished business above that has no timing factor to it what about Friday’s Friday’s close hat 24 5650 which was the room for noise above the unfinished business well that creates the potential and with timing for a pullback in fact the timing is immediate or not at all it’s not a requirement it’s not a signal like the new trend High closes and Signal saying or set up or going to have a new High clothes to follow but it would have timing to it but there is timing to the clothes at or under 5654 that a signal tonight so either 5650 is going to hold it can be proved intraday probed above but having clothes there says that the sponsorship if it doesn’t get reinforcements today is in that is to drive it higher is in need of finding reinforcements From Below so if there’s a pull back if if the market goes looking for a sponsorship to extend the rally below it’ll find it either 50 2449 or there’s levels and start getting somewhat substantial below so what about the open it open going to take care of that and start rallying that’s that’s dependent on 59 59 itself 2459 is the balance of it that I identified at Friday’s close that would maintain that deeper pulled back potential only bounced but only bounce so long as 59 holds that keeps the door open today afternoon 50 otherwise 12:36 and 12:43 are the next higher highs silver pretty strong notice it did not did not probe fresh highest Friday with gold kind of making up for the are trying to compensate for that delay today Long Pond has no unfinished business below has a warning shot across the bow on Wednesday that was retraced to lower prioritize back within that range the 61 8 retracement and Cetera of a lot of those swings bigger surge at Friday’s will Friday morning no requirement for a correction of that and yet it did correct so there’s just at this point not much room but little reason to delay extending hire through 153 this should be 153 and overnight 153 is been touched or pretty open here bottom is formed just needing to be triggered crude oil did finally close about 46 this is this is not the most credible close by 46 + 2 closes at 46 so it’s a trigger the closing back of the 46 today wood Decatur hand and natural gas really Friday’s pre-open dip fill the Gap sort of you don’t really feel gaps overnight but it did hold the test of the Gap back the last Monday’s close there’s really didn’t really require being filled at all anyway so that was kind of nice of them to do that but still needs to exploit that and there’s really no reason why delay to the rally has no further justification for it .
Morning Bias
| MON morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2461.50 | 2459.00 |
| …would target | 2467.00 | 2464.75 |
| Bias-down: under | 2455.75 | 2453.50 |
| …would target | 2451.50 | 2449.00 |
| Signal status: NO-BIAS | 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)
It’s not often that a trend has no “unfinished business” outstanding. That was the case Friday afternoon, which met the morning’s 2452.25 bias-up target, the nearly 4-week old 2454.00 bias-up target, and Friday afternoon’s 2456.50 bias-up target to within 3 ticks.
Not often, but not rare.
Rare is that only one setup was available to create new unfinished business above. That would be a new trend high close. And that condition would create new unfinished business only because it was a Friday. New trend high closes during the week don’t have the same relevance.
Other attractions that Friday’s rally neutralized include any prior high that was probed intraday. Which is a risk. Closing above a prior high can be a breakout or be of little significance. But probing a prior high without closing above it can be significant resistance. The rally risked ending with every new high it probed. But it succeeded.
Its last half-hour reaction down from 2461.25 to 2455.00 let sellers do the same thing with support as buyers did with resistance. The afternoon rally’s last relative low was pierced by the session’s final bar. While that was too late for its break to be relevant, it’s still a failed attempt. Still, closing at the 2456.50 room for noise above the nearly 4-week old “unfinished business” does suggest that buyers need a rest… if only to hunker down as quarterly earnings start.
Details and other markets coverage are discussed in the post-market Wrap recording here.
Check your email for the Saturday Review link tomorrow morning, which begins at 9:30 ET.
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))
Having held the 1.1450 pullback limit Thursday, Friday morning’s econ reports easily triggered a surge attacking 1.1510-1.1525 resistance. Holding its test enables closing under 1.1450 to signal the trend reversing down.
Gold Aug Contract (GC, ETF: (GLD))
Gapping up Friday back above the 1219.00 sell signal avoided confirming Thursday’s shallow close under it. Back under 1222.00 would now signal new lows. Otherwise, this bounce can extend to 1236.00 or 1243.00.
Silver Sep Contract (SI, ETF: (SLV))
Thursday’s dip was extended overnight to test the 15.55-15.60 pullback limit before rallying into Friday’s close, and gapping up to recent highs at 16.00. Holding above 15.75 now allows extending higher to 16.30 or 16.70.
30-year Treasury Sep Contract (US, ETF: (TLT))
Initially surging in reaction to Friday’s econ reports formed a gap up to 152-12 that surged through Thursday’s highs up to 153-16. Its reaction retraced back down to the 152-12 opening print. “Another warning shot across the bow” at sellers? No further backing-and-filling is needed before resuming the recovery.
Crude Oil Aug Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Wednesday’s open and Thursday’s close were both at 46.00, preventing it from signaling a rally underway. That didn’t prevent fresh highs Friday morning from testing 46.75. Closing back under 46.00 would be the first step to allowing a more durable bottom to form, but this continues regardless to be a bottoming pattern.
Natural Gas Aug Contract (NG, ETF: (UNG, UNL))
Dipping overnight to 2.92 essentially retested the gap back down to Monday’s close, Friday’s open was at Thursday’s low, and firmed from there. No further backing-and-filling is required to form a bottom, so any early strength Monday would be credible for extending higher intraday.