S&P
Morning Bias
| THU morning signal (triggered at 10:15 ET) | SPX | ES |
| Bias-up: above | 2362.75 | 2361.25 |
| …would target | 2369.75 | 2368.25 |
| Bias-down: under | 2354.25 | 2352.75 |
| …would target | 2348.00 | 2346.50 |
| Signal status: LATE BIAS-UP | 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)
Wednesday afternoon’s slide originated during a no-bias environment. Its 2369.75 bias-down signal wasn’t broken until after 1:30, which is too late to trigger or to invalidate. The “no-bias trending” is doomed to failure, but that didn’t prevent extending down sharply to test 2358.00. Regardless, and from whatever level, the break must be retraced at some point.
Wednesday’s bearish WedEX signal is neither passive nor active. The session’s break was the first to close under a prior range. So, actually, WedEX is not YET passive or active — that will be determined by Thursday’s open either recovering prior highs, or not.
The bigger picture is at risk of unraveling to the downside. But that would require another session like Wednesday, relentless albeit shallower. Wednesday’s close under its prior low, following Tuesday’s fresh high, is the basis for reversing the trend down. While new highs remain possible otherwise, reversing up to that degree is not likely before basing for awhile. And that’s the bullish scenario.
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 Jun Contract (EC, ETF: (FXE, UUP))
Tuesday’s surge to new highs was unlikely to reverse anytime soon, as confirmed by extending higher overnight and Wednesday. A top is still unlikely to be evident soon, but potential of backing-and-filling can’t be dismissed.
Gold Jun Contract (GC, ETF: (GLD))
Political instability triggered an overnight surge that filled an outstanding gap above before Wednesday’s open. Extending higher post-open tested “higher prior lows” at 1253.00, with the next higher potential being 1261.50.
Silver Jul Contract (SI, ETF: (SLV))
Breaking higher overnight still had difficulty at 16.75 Wednesday, but maintained potential for testing 17.09, so long as 16.75 isn’t broken as support.
30-year Treasury Jun Contract (US, ETF: (TLT))
Political instability and sliding stocks triggered a second consecutive session to rally Wednesday, of blowout proportions, confirming the bottoming pattern that was first signaled on Friday. Breaking above both 151-22 and 152-00 reversed momentum up and extended substantially to 153-26. Pullbacks must hold 152-27 to avoid reversing down.
Crude Oil Jun Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
The reaction to Wednesday’s EIA report bounced back up to the 48.90-49.30 range’s upper-end, largely ignoring the turmoil in other markets.
Natural Gas Jun Contract (NG, ETF: (UNG, UNL))
Wednesday extended the prior two days of selling by extending under the original 3.21 sell signal, down to 3.16 where the original sell signal’s breaks had run into support. Considering the degree of the interim bounce, there’s no bullish reason to have retraced.
Mid-day Update… Squeezing out the last drop.
Still probing fresh lows.
This afternoon’s 2369.75 bias-down signal didn’t trigger. That hasn’t prevented probing under it anyway, which had become somewhat likely since its ongoing test wasn’t being rejected. This morning’s 2366.25 low has now been probed by 3 ticks.
That’s “no-bias trending,” which is doomed to failure. Breaking the bias-down signal too late must be retraced. Eventually. Often the same day or timing window. Sometimes much later, and from much lower.
Exiting the bias environment at 2:30 back above the bias-down signal would be a good start at a short-squeeze. Exiting above the 2374.75 prior high would be better. Regardless, the prior high’s recovery can’t wait for the final hour, or else the decline would be vulnerable to extending.
P.S. This cycle’s WedEX will trigger this afternoon. It’s signal isn’t obvious, which we’ll discuss later.
Look ahead: Economic Calendar – for Thu May 18, 2017
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: Thursday morning’s Philly Fed is the only regional survey with a reliable track record for influencing price action. Jobless Claims was influential two weeks ago, but not last week. Any obvious reaction at 8:30 is likely to be duplicated in reaction to the 10:00 LEI.
Jobless Claims
8:30 AM ET
*Philadelphia Fed Business Outlook Survey
8:30 AM ET
Bloomberg Consumer Comfort Index
9:45 AM ET
*Leading Indicators
10:00 AM ET
EIA Natural Gas Report
10:30 AM ET
10-Yr TIPS Auction
1:00 PM ET
*Loretta Mester Speaks
1:15 PM ET
Fed Balance Sheet
4:30 PM ET
Money Supply
4:30 PM ET