Post-open Review

Bias-up target held, bias-up signal not so much.

Slightly higher highs greeted the open at 2282.00. A post-open surge touched 2285.00. That didn’t last long.

Slipping back under the 2283.50 bias-up target had room for noise, alone, down to the 2278.50 bias-up signal. It was met, and tested through the 10:15 bias timing window to invoke the grace period.

2278.50 was still being overlapped at 10:30. Overlapped to within 2 ticks. That’s not a decisive rejection of the bias-up, but price has slid anyway. down to 2272.00.

Decisively rejecting both bias-up parameters would have put into play offsetting tests of both bias-down parameters. A synthetic bias-down. This morning’s setup doesn’t require it, and sponsorship for trending will be difficult ahead of this afternoon’s FOMC statement.

Regardless, back above 2277.00 would signal the post-open drop was absorbed, and momentum is reversing up into the announcement. Otherwise, the 2270.75 bias-down signal can offer support, but with no requirement to hold or to prevent extending down to the 2265.25 bias-down target.

Opening dip attacks yesterday’s low.

Yesterday afternoon had been trying to trigger a sell signal under 2270.00 when a late rally began. Originating late, its sponsorship was weak-handed, dooming it to failure. Further undermining the recovery attempt, the late bounce fulfilled the maximum bounce target at 2277.00. And held it. And closed AT the critical 2275.00 instead of above it.

One overnight plunge to 2268.00 was recovered entirely to 2275.00. The open could have isolated the probe under 2275.00 to the overnight. It didn’t. The open was greeted at 2269.00-2272.00.

Yesterday afternoon’s sell signal under 2270.00 would have targeted a retest of the morning’s 2263.50 low, required by its oversold RSIs. That was attacked to within 3 ticks while probing under this morning’s 2271.50 bias-down signal and its 2266.00 bias-down target.

The reaction up triggered a buy signal above 2266.75 that extended up to 2269.75. Having fulfilled the bias-down target, entering the noon hour back above the 2271.50 bias-down signal could launch a rally back to new highs.

But stopping optimistically short of actually touching yesterday’s low isn’t likely to produce a durable recovery. Fresh lows would target 2259.75, which could hold as the low, or else break lower targeting a retest of 2248.50.

Still haven’t found strong-handed buyers.

Gapping down had suggested the rally would be seeking out buyers at lower levels, still trying to stretch the rubber band enough to snap momentum back up. “Lower prior highs” at 2275.00 had been the likely objective after Thursday and Friday’s dips to 2292.00 and 2287.00 had proved too shallow.

2275.00 was too shallow, too. A fresh low just printed 2263.25. Like the lows that preceded it, its 1-minute and 3-minute RSIs were oversold. And that requires at least an eventual retest of the low.

Currently bouncing to 2266.00, another point higher would start to suggest a bigger bounce underway. It’s too soon to suspect it of gaining traction, or of avoiding a retest of the oversold RSIs low.

A low will need to form relatively soon, and relatively nearby, because the only other support below is prior lows, and that’s not very durable.

If Confucius were a trader.

Confucius said, “no decision IS a decision.” This morning’s open said, “noN-bias.” And that really IS not a bias.

At least no-bias would have put into play an offsetting test of the bias-up signal. Bias-down would have put into play the bias-down target. But noN-bias was triggered by overlapping 2289.75 at 10:15 and again at 10:30. This morning’s window has no requirements of it.

Fortunately, we do have a bigger picture roadmap. Regardless of being deep or steep, only a brief dip this morning would be appropriate for resuming the rally today. Bias-down would have fit if resolved quickly. So, resuming the rally today may wait until the bias environment begins lapsing, but need not.

By the same token, exiting the bias environment in decline to fresh lows would not be bullish. Probing a fresh low before then could recover. Otherwise, it would be yet another reflection of weakness, along with not confirming Wednesday’s breakout, and Thursday’s flat, narrow ranging.

Overnight rally is retraced entirely.

The “new Globex trend extreme” at 2299.50 should be retested at some point intraday. F\Breaking back under the 2291.75 overnight low through the open would have made the high’s retest unlikely today. The inverse is not true. So, holding the overnight low’s test through the open does not require retesting 2299.50 today. But it does keep the door open.

Trading around unchanged isn’t preventing the overnight high’s retest. A bigger impediment is that negative territory was probed so shallowly. More precisely, that it was probed so shallowly without already reacting up. A deeper dip holding the 2289.25 bias-down signal would have put into play an offsetting test of the 2297.50 bias-up signal. Instead, the rubber band wasn’t stretched tightly enough to snap back up forcefully.

Reacting up is nonetheless printing fresh post-open highs up to 2296.50. But that’s still overlapping the 2296.00 open’s peak. And RSIs aren’t improving, or even attacking overbought. While a new downleg this morning is unlikely, suddenly rallying isn’t much more likely.