Post-open Review

Post-open dip suggesting it’s a correction.

Pulling back from the 2388.75 overnight high greeted the open at the 2384.00 bias-up signal. The first half-hour ranged there, and down to 2382.00. Then it broke lower.

The 2377.75 overnight high was touched. Its reaction up seems obligatory, and temporary. Anyway, failing to trigger the 2384.00 bias-up signal has put into play an offsetting test of the 2376.00 bias-down signal.

Having probed already under the pre-10:15 low, 2376.00 will become “unfinished business below” if not met this morning. Its test need not define the pullback, especially with a bullish WedEX likely to rescue even a deeper drop.

The open’s persistent overlap created congestion that is likely to be retested, regardless of that test’s resolution. Recovering 2385.25 would leave unfinished business below, but could still probe fresh highs first. But the near-term trend has otherwise reversed back down.

Bias is up. Slope is unknown. Path is not assured.

The 2370.25 overnight high reacted down through the open to probe 1 point under the 2366.75 bias-up signal. The bias-up signal held through 10:15 to be triggered, putting into play its 2372.75 bias-up target.

Bouncing before the 10:15 bias timing window had been hovering at post-open highs, just under the overnight high. That was deceptively optimistic, at least restrained optimism, which is potentially bullish from a contrarian perspective.

Not triggering bias-up after testing it would have targeted a test of the bias-down signal. Already probing above the pre-10:15 high has made the bias-up target unlikely to be invalidated.

Another bullish behavior is that a reversal setup was avoided. Trending relentlessly overnight in a single direction to a fresh extreme is often reversed at the open. Maintaining the gap up can still be reversed, but it’s more likely to extend.

None of which changes that it’s difficult to attract sponsorship ahead of a weighty event like this afternoon’s FOMC. And none of which prevents an interim dip (drop, plunge, spike) from anxiousness ahead of the rate hike, or in reaction to it.

Consequences of delay.

The overnight dip down to 2366.00 had reacted up to attack 2370.00. Its recovery was the minimum requirement to even begin rallying immediately post-open. Anything less would likely back-and-fill, if not actually slide.

But price already started sliding well before the open. Dropping back down to 2362.00 was retraced almost 4 points pre-open, but a post-open slide attacked 2359.00. The 2358.00 bias-down target was attacked before triggering bias-down.

Probing it down to 2356.00 came almost immediately after 10:15, which is too late to renew the bias-down signal. This is still a bias-down environment. Oversold RSIs at the low doom any recovery attempt to failure. Potential extends down Thursday’s 2351.00 low whose RSIs also require a retest.

Testing the 2355.00 upper-end of the consolidation at Thursday’s lows might suffice. Back above 2363.75 would start to signal momentum already reversing up.

Friday’s highs holding.

Overnight highs were probed before the open up to 2370.50. A post-open surge touched 2372.00. That was half the requirement for rallying this morning. the other half was to maintain the surge, but it was quickly retraced to back under the overnight high.

Friday’s 2370.00 high ultimately held as resistance. This is  a no-bias environment. And since neither bias signal was touched, no offsetting test of the other bias signal is required.

Fresh post-open lows have tested 2367.00. The 2365.50 bias-down signal could be tested, or even probed so long as its test were ultimately to define the window’s lower-end. Breaking lower later would open the door to attacking or retesting Thursday’s 2351.00 low.

Bounces meanwhile should hold 2371.25. Exiting the bias environment above 2372.50 would be credible for extending higher this afternoon.

Overnight highs never retested.

Firming off of 2370.00 had greeted the Employment Situation report. Its reaction surged to 2376.25. Drifting into the open still gapped up to 2373.50. But that was quickly extended down 6 points to 2367.75.

Which is still a bias-up.

Actually, the open had been retraced up to 2374.00 before 10:15. The 2370.75 bias-up target was also exceeded to renew the bias-up signal, next targeting 2377.50.

Which hasn’t prevented dipping deeper.

The 2365.75 bias-up signal was itself tested, and now retested by 1 point. “Counter-bias trending” is doomed to failure for originating during a bias-up environment. Meanwhile, there’s room down to lower prior highs and a gap in the 2361.00-2363.00 area.

Back above 2368.25 would start to signal momentum reversing up, which could extend through the noon hour.