Post-open Review

Holding resistance through a relevant window. Again.

Despite touching and reacting to the 2362.50 bias-up signal overnight, an offsetting test of the 2351.75 bias-down signal wasn’t in-play. In fact, after reacting down pre-open to within 6 ticks of the bias-down signal, rallying into and out of the open reached the bias-up signal.

But the grace period was invoked, and it wasn’t exploited. So, this is a late no-bias environment. The 2362.50 bias-up signal should define the morning’s upper-end. And an offsetting test of the 2351.75 bias-down signal is in-play.

Since this recovery already includes no-bias trending, we must consider potential for extending higher anyway. And although this morning’s action hasn’t exploded up to fresh highs, it did explode up from the open’s dip. Fresh highs would open that door.

Pre-open and post-open lows bouncing.

The overnight dip had touched the 2350.00 bias-down signal. Its pre-open bounce up to 2353.25 was retraced, and then extended post-open down to 2348.75. But this morning’s template for trending down has since been ignored.

Instead, a bigger bounce touched 2355.00 as the first half-hour lapsed. Consolidating there for awhile around yesterday’s 2354.50 cash session close has now broken to fresh highs attacking the 2358.00 bias-up signal within 1 tick.

3 ticks would be close enough to fulfill the requirement to test 2358.00. Its test was put into play by holding the bias-down signal’s test. It won’t become unfinished business above if not actually touched this morning.

Back under 2353.50 would start to signal the post-open recovery is failing. Dipping to fresh session lows would still be possible. Otherwise, there’s room up to yesterday’s 2360.50 high before suggesting that the rally is extending, regardless of no-bias trending restraints.

Pre-open drop’s space filled by big swings.

Rallying this morning was already unlikely. Yesterday’s rally had peaked upon fulfilling its buying pressure at the the afternoon 2341.50 bias-up target. And the intraday rally gained no traction. Not gapping up above prior highs would make downside attractions more likely.

Reacting down from probing fresh highs overnight greeted the open at 2334.75. A post-open bounce had room up to 2339.00-2340.00 for another reaction down. Which it did, touching the 2333.50 bias-down signal.

Then headlines hit. A strong econ report, and news of another healthcare push, triggered a surge up to the morning’s 2342.25 bias-up signal. Which held.

Reacting down yet again has tested 2336.00. Any lower would suggest a new downleg underway. Meanwhile, a bounce now has room up to 2341.00 before suggesting a bigger upleg. Both are likely to hold while awaiting a press conference starting soon. I’m inclined to wait, too.

Gap down holding, but not rejected.

Attacking 2317.00 to within 3 ticks overnight had bounced to test 2327.00. It was retraced into and out of the open to test 2318.00. Twice. The second test produced a bounce that recovered the overnight bounce.

That’s a wide range, and a lot of volatility within it, especially for being contained within the first half-hour. Which makes the second half-hour all the more glaring, for its 3-4 point ranging up to 2327.00.

Now the final hour is ending with a retest of 2328.00. It’s a little too little and a little too late to be a strong-handed recovery. Extending any higher would target 2331.00 up to 2335.50. Entering the noon hour any higher would start to suggest this downleg has ended.

Otherwise, an intraday retest of 2317.00 isn’t required but likely. And it’s probe down to 2311.00 isn’t yet likely, but becoming more so.

Pre-open rally, post-open surge, bias-up trigger.

The overnight rally to 2349.50 retraced 61.8% of yesterday afternoon’s drop. Its reaction back to unchanged at 2341.00 could have extended into a gap down, but did not. Instead, another bounce greeted the open at 2346.00, retracing 61.8% of the overnight drop.

This retracement extended higher. Fresh highs touched 2350.50, and started ranging sideways. And is still ranging sideways. Choppily. The 2346.75 bias-up signal was touched as support, AFTER it had already triggered. A fresh high printed momentarily, but hasn’t extended higher.

Now having printed above the pre-10:15 high, invalidating the 2352.25 bias-up target must exit the bias environment under the 2335.00 bias-down signal. Difficult, and unlikely. So, not meeting the target this morning would make it “unfinished business above.”

Meeting the target early enough would allow time to reverse back down. Friday Factors could protect against that if not already reversing down by noon — protect against reversing down, if not also enable a short-squeeze higher.

Regardless, gapping up under yesterday afternoon’s high means that sellers will not be marginalized today. A downdraft could develop at any time.