Post-open Review

Extended pre-open rally hasn’t been reversed.

This morning’s 2662.50 bias-up target seemed generous compared to its 2652.25 bias-up signal. And it was already being tested by a couple of points during the Market Tour recording. Renewing the bias-up signal would next target an equally generous renewed target at 2672.00-2675.00.

Which another pre-open surge already probed up to 2678.00.

The most bearish resolution would still allow this morning to back-and-fill, potentially down to 2652.25, still avoiding yesterday’s range by 2-3 points. Keeping optimism excessive is very important at this stage of the nascent reversal attempt. Backing-and-filling has been limited testing the 2662.50 bias-up target as support. So far.

Resuming the rally at any time would next target 2681.00 and then 2686.00. Despite not yet resuming the rally post-open, also not yet rejecting it allows its resumption at any time — triggered and/or confirmed above the 2675.00 renewed bias-up target.

Pre-open rally briefly probes positive territory.

Sunday night’s gap down and first-hour dip to 2609.50 was finally recovered to probe positive territory up to 2645.00. Before the open. Reacting down 14-16 points into the open had yet to correct. A post-open bounce tested 2639.00 — retracing 61.8% of the pre-open drop.

The bounce is normal. But delaying the correction until post-open often develops into a complete recovery. Today’s delayed 61.8% correction did hold, and did reverse down to attack the overnight low at 2609.75.

Despite stopping optimistically short of touching the overnight low, a bounce retested the bias-down signal up to 2639.50. And THEN resolved down. Fresh lows are now probing under Oct’s 2603.00 low to 2598.25.

The open’s delayed bounce was ineffectual pessimism, which is usually bullish from a contrarian perspective. The post-open low’s first bounce from only attacking the overnight low is ineffectual optimism — which has now resolved appropriately. Either the open’s bounce was an anomaly and a much bigger downleg is underway, or else October’s low is being retested to form a more durable bottom.

Relief rally reverses quickly to test support.

Greeting the Employment Situation report at 2685.00 reacted up relatively shallowly to 2693.00, so wide is the range. This confirmed suspicion #1 that any focus on the report was mostly to get beyond it, and not that its data or reaction would guide intraday price action.

Suspicion #2 was that the shallow reaction would be rewarded with a relief rally, to whatever degree, probing above yesterday’s late 2699.00 high. That arrived in a post-open surge to within 5 ticks of this morning’s 2711.00 bias-up target.

Then sellers arrived, and the action really began. Reversing back under the 2702.50 bias-up signal put into play an offsetting test of the 2680.25 bias-down signal. Which was touched within 3 minutes of 10:15 to invoke the grace period. And then triggered through 10:30.

The 2668.00 bias-down target was soon pierced by 2 ticks. Fresh lows after both 10:10 and 10:30 are difficult to reverse, regardless of the objectives being met — especially when the low is accompanied by simultaneously oversold RSIs. So, be careful with buy signals, the earliest being back above 2680.25. The downside’s limitation is to tests of 2656.00 and 2626.00.

Volatile open chips away at fresh lows.

As late as the 2650.00 overnight low was being attacked to within 2 points, its eventual probe was likely. Immediately probing it by 1 point snapped back up 11 points almost as quickly. But that was retraced to fresh lows, whose reaction struggled for too long to attract reinforcements, and now has also fallen to fresh lows at 2637.75.

Prior lows at 2626.00 are the next lower attraction whose test can also provide some support for a bounce. As grudgingly as the open has finally resolved down, I’m not relying on much support there before extending down to at least attack October’s 2603.00 low.

Bouncing anyway — prior to 2626.00 or from below it — won’t be credible for reversing the trend up, no initially until forming some sort of basing or accumulative pattern.

REMINDER: I’M UNAVAILABLE BY NOON. PM BIAS PARAMETERS SHOULD BE AVAILABLE, BUT NO OTHER UPDATES UNTIL THIS EVENING…

Rallying off of the 2767.25 overnight low gained 20 points at the pre-open high. It was retested post-open, but never exceeded to signal momentum reversing up. Reversing back down triggered this morning’s 2780.25 bias-down signal and extended to 2772.00, but was still overlapping the 2775.25 bias-down target at 10:15 to avoid renewing the bias-down signal.

It’s still a bias-down environment. Which fresh lows at 2769.50 after 10:15 are confirming.

It’s still a bias-down environment. So, the decline can still extend to what would have essentially been its renewed bias-down target at 2763.00. But the lower target isn’t in-play, and the entire session’s lower volume undermines any other usual reliability.

Meanwhile, RSIs aren’t deteriorating, which is also undermining the decline’s reliability. Selling pressure isn’t increasing, so back above 2778.00 — and recovering the 2780.25 bias-down signal when the bias environment begins lapsing — would point higher through the afternoon.