Post-open Review

Big gap down stays down.

The pre-open slide to 2012.25 reacted up into and out of the open to 2022.00. Just 3 ticks higher would have signaled the overnight decline was being reversed back up.

Instead, a reaction down ultimately extended to fresh lows at 2011.25. That also reacted up to touch 2022.50. Ranging there lasted too long to be considered as rejecting the decline.

One last gasp up to 2025.50 has been reversed down to 2012.25. Its next lower attraction is to retest the low. But the pattern’s purpose is to resume the overnight decline.

This has been a quite an open. The overnight slide is essentially validated by having delayed its rejection. As I discussed pre-open, Fridays have greater vulnerability to trapping an overnight move. But that window had to be exploited early, or else not at all.

Having dropped so much so quickly, already expending a lot of selling pressure, the slope need not steepen into new lows. But it should behave in a relentless way on the way down to 2009.50 and 2003.00.

Retesting overnight highs.

The 2046.50 bias-up target had been met already overnight. Its reaction down had touched 2036.00 pre-open. And then post-open, too.  Its latter test launched a retest of 2046.50 to within 1 tick.

The bias-up target’s retest also reacted down to 2036.00. But the 2040.75 bias-up signal was overlapped within 3 minutes of 10:15 to invoke the grace period at 10:30.

And the grace period triggered “late bias-up.”

A more thorough test of 2046.50 is likely, probably up to 2048.00. None of which changes the likely retest of yesterday’s ~2027.00 low, whose path was always suspect. That attraction can still be neutralized, initially by exiting this morning’s bias environment above 2046.50.

REMINDER: I’m away from the screens today between 1:30-3:15 ET… back for the final hour..

The pre-open dip to 2049.75 held its test of yesterday morning’s lows, greeting the open at 2054.50. Recall that was a preliminary level noted in the First Trade blog post. Recovering it or not through the open would at least be predictive of the bias-down signal.

2058.25 was another preliminary level, and it was also tested during the opening 15 minutes. Its first reaction down was brief, held 2054.50, and reversed up sharply to 2069.00.

The opening surge’s template played out as much as it did yesterday. The only difference was its low’s timing, this time being pre-open instead of post-open. But their similarity is their Achilles heel — the setup should launch almost precisely at the opening tick.

This morning’s surge, unlike like yesterday’s, isn’t done. The 2074.25 bias-up target was met and held, but is now being probed to attack the 2080.50 renewed bias-up target. A pullback to 2065.00-2066.00 is possible, regardless of the potential for extending higher this afternoon, if not also because that upside potential would benefit from the refueling.

Rally window is closed for now.

The bullish template was disqualified when the open delayed rallying, and instead extended down. A bearish template didn’t fill the void, not without the opening 15 minutes of volatility being exited under the opening print, which it was not.

That alone warns us of a choppy morning ahead, if not a choppy session. And this is regardless of there being an objective in-play, like the potential for choppy ranging to visit 2048.00 at some point.

Exiting the bias environment above 2060.00 would start to undermine sellers. There is otherwise much greater potential to probe fresh lows.

Correcting Friday’s weak-handed upleg.

The origin of Friday afternoon’s rally leg had indicated that its sponsorship was weak-handed. That doesn’t prevent probing higher, but it does require its correction.

The minimum objective for a correction has been met, in the minimalist of ways. Potential to 2075.00 was attacked to within 1 tick.

The 2074.50 bias-down target has been met to within 3 ticks. It’s still an attraction, but won’t be considered “unfinished business” if never touched.

Meanwhile, the correction can extend down, whether to 2072.00, or to 2065.00 and potential also 2060.00. Exiting the bias environment back above its 2080.50 bias-down signal would suggest the correction had ended.

Late update: 2074.50 was just met. RSIs are diverging positively, but the corrective trend otherwise remains down.