Post-open Review

Overnight rally extends through the open.

Market Tour was recorded while the 2744.50 earlier Globex high was serving as support, after having recovered from probing yesterday’s 2730.25 overnight low. A bullish Globex-flip setup needed only to maintain that much of a recovery. But China trade headlines triggered the rally’s resumption.

By the time of my pre-open comments, the nearest buy signal was 2757.75. It was triggered just minutes later by a surge up to 2769.00. The open held up, and has already been rewarded by a fresh high at 2773.00 as more China trade headlines hit.

This being a Friday, the morning’s bias signal tends to persist through the noon hour. That doesn’t require extending higher, or that extending higher be steep. Being a bias-up, a reaction down could test the 2753.00 bias-up signal as support. But the Globex-flip setup suggests the rally will persist through the morning.

None of which affects the bearish WedEX influence due this afternoon. The setup can’t be inverted again, and can only be invalidated by not trending down during the afternoon bias environment and final hour. Meanwhile, trend extremes aren’t normally associated with expirations, and a new trend extreme close on a Friday all but requires another trend extreme close before a reversal down is credible.

Overnight rally hits its resistance, plunges through the open.

Gapping up above yesterday’s 2762.00 high could have reinstated the rally. Its upside momentum became inertia when yesterday’s close overlapped its 2753.00 open. This setup often appears at extremes because it reflects the trend sponsorship’s weakness.

That vulnerability probably exacerbated the reaction to pre-open headlines that triggered a 20-point collapse to 2737.50. Extending to 2730.25 post-open held under Tuesday’s 2738.75 and 2741.50 last relative lows through the opening 15 minutes of volatility to create an anchor below.

None of which prevented a bounce, which tested the 2746.50 bias-down signal’s resistance up to 2748.25. Already too late for its recovery to invalidate the bias-down signal, and required to define the window’s upper-end, a 13-point plunge attacking 2735.00.

The headline catalyst is artificial, better enabling the latest plunge’s recovery. Recovering the 2746.50 bias-down signal into the noon hour could retest 2755.00. Otherwise, the decline remains vulnerable to extending down.

Overnight high’s retest isn’t rejected.

The complexity of last night’s probe above Tuesday’s highs up to 2757.00 had formed a “new Globex trend extreme” which requires intraday retest, and is often retested the same day. Recovering 2753.00 through the opening 15 minutes of volatility would target 2757.00, if not also higher. It was probed up to 2762.00.

Reacting down to attack 2753.00 only overlapped the 2755.00 bias-up target through the 10:15 bias timing window. This avoided renewing the bias-up signal. It’s still a bias-up environment, but not bias-up renewed, which would have added a degree of confidence in extending higher. That hasn’t prevented at least trying to resume the rally, now testing 2761.00.

The bigger picture bear market rally limitation requires closing back under 2757.00 and preferably also under 2751.00. Topping requires a retest of the 2753.00 opening print after a post-open dip under Tuesday’s highs. Reversing the trend down requires at least closing negative under 2743.50. Today’s WedEX should be a passive bearish setup to reflect an unsustainable bullish sentiment.

Meanwhile, the intraday and bigger picture each allow extending higher. Maintaining 2757.00‘s recovery through the bias environment exit would next target 2769.00. Back under 2755.00 at any time would start putting into play a dip back into yesterday’s range.

Overnight rally extends intraday.

The overnight rally peaked upon testing the gap back up to last Wednesday’s 2730.00-2731.00 close. This doesn’t qualify as filling the gap, which must be done intraday. But a pullback down to 2726.00 surged at the open, to and through overnight highs up to 2733.00. Gradually eking even higher has touched 2735.50.

2735.50 isn’t an impressive calculable target. As resistance, 1-minute RSI diverged negatively and 3-minute RSI eventually left persistently overbought territory. Price has reacted down to 2732.00. All of which seems to be noise, since 2735.50 satisfies very little buying pressure.

2735.50 also stops pessimistically short of touching last week’s 2737.00-2737.75 highs. That’s potentially bullish from a contrarian perspective. Reacting down under 2732.00 could test 2730.00 and still be likely to resume the rally. Unless something more dramatic were to develop below, the rally could extend to 2743.50 or 2751.00.

Overnight rally not attracting reinforcements.

Two overnight probes above this morning’s 2719.00 bias-up target had reacted down to attack and then test the 2711.00 bias-up signal. The grace period was invoked to give it one more chance at triggering, but fresh lows down to 2706.00 failed to trigger it.

Late no-bias has put into play an offsetting test of the 2704.50 bias-down signal.

Fresh lows through 10:15-10:30 reinforce the late signal, although the dip hasn’t yet extended lower since then. Back above 2712.00 would start to signal that reinforcements are being overwhelmed by a detour to fresh post-higher, perhaps up to 2719.00.

Meanwhile, 2708.00-2709.00 is trying to hold as support, or as a magnetic attraction. In either case, breaking lower to 2704.50 is still challenging 2708.00-2709.00.