Post-open Review

Pre-open breakout restrains itself to maximum effect.

Having ranged sideways overnight, breaking out either way 60-90 minutes before the open would have been considered a false break. In fact, the range’s 2914.75 upper-end was probed by 2 points before 8:30.

Soon the breakout retraced back into the range. The breakout could have extended further before allowing the retracement consequence. Instead, optimism was restrained. A shallower pre-open probe above 2914.75 also retraced back into the range, through the open. The overnight range’s ill-timed breakout problem was negated. No further pullback is required.

The first 3 post-open minutes contained the pullback, and the balance of the hour has trended up to attack 2924.00. Last Wednesday’s 2923.00 gap up above all prior highs is filled, although it wasn’t required since its first minute had also overlapped “lower prior highs.” Hesitation just under 2923.00 was “ineffectual pessimism,” as was the immediate reaction down to finally piercing 2923.00. Both are potentially bullish from a contrarian perspective… and now 2924.50 is being tested.

Meanwhile, the bias-up signal is renewed for having exceeded its 2920.25 bias-up target through 10:15. The renewed bias-up target in-play is 2926.50-2928.00.

Bias-down target’s support, recovers to bias-down signal — which won’t let go.

Gapping down to 2900.00 spent several minutes in a 2-point range at 2899.00-2901.00, touching the pre-open low while also overlapping the 2900.25 bias-down target. Then a surge developed that ultimately probed the 2906.00 bias-down signal up to 2909.00.

Bias-down triggered at 10:15. A bounce overlapped it at 10:30, but didn’t recover it, so bias-down was maintained. Bias-down, target met. Another test of the 2900.25 bias-down target is in-play. Already having tested it, it won’t become “unfinished business” if left outstanding.

First things, first. The 2906.00 bias-down signal keeps attracting price back up to it. Most recently by a surge now attacking the open’s 2909.00 high.

The context of this being a bias-down environment makes any recovery suspicious. The bearish Globex flip’s context, too. Even if ultimately extended higher, at least a dip back down to 2906.00 would be required (unless exiting the bias environment above its 2914.25 bias-up signal). But the surges probing above 2906.00 area are aggressive, and should take precedence over staying short.

Recovery holds resistance, reaction breaks support.

The overnight drop to significant support at 2892.00-2894.00 “lower prior highs” had blipped-down to 2889.50. That was a rubber band stretch, which snapped back up to probe the 2908.75 bias-up signal by 3 points before the open.

Yet another open being greeted by an overnight rally, albeit this time a rally from negative territory. Regardless, yet again, post-open sentiment took a 180-degree turn. The open was narrowly consolidated around 2908.75 through the opening 15 minutes of volatility. And the consolidation broke lower to test the 2899.00 bias-down signal.

No-bias triggered cleanly, but breaking under 2899.00 through 10:30 invalidated that. This is an invalidated no-bias environment. No requirement for the bias-down signal to define its lower-end, no requirement for an offsetting test of the bias-up signal.

After extending down to 2895.00, a bounce is now testing 2899.00 as resistance. But is it too late to extend down? Is strong-handed sponsorship done for the day, ahead of the 3-day weekend? Back above 2901.50 would start to signal another bounce. Otherwise, back under 2897.25 would resume the decline.

Pre-open buyers get carried away, get heads chopped off.

I described the bullish scenario in the pre-open Market Tour and First Trade post: Keep optimism in-check. Aggressive gaps up have been meeting a reliable pattern of significant intraday pushback. None so significant as today’s.

Opening under yesterday’s 2920.00 post-open high could have crept higher without enticing sellers. But the 2923.00 open was already above yesterday’s post-open high, and also above its 2921.25 pre-open high. The first bar’s dip back down to 2920.00 extended relentlessly back down to touch yesterday’s 2904.50 low.

The 2906.50 bias-down signal was overlapped at 10:15 to invoke the grace period, and ultimately held to trigger no-bias. Had sellers been patient to avoid touching 2906.50 so early, offsetting tests of BOTH bias-down parameters could have been put into play for having rejected tests of both bias-up parameters. Impatient sellers instead extended the pattern unsustainably, and now a bounce is targeting a test of the 2914.50 bias-up signal.

Being a late no-bias, the bounce is vulnerable to failure. The collapse was likely not only to touch yesterday’s low but to probe it, if not also Monday’s low. Back under 2907.25 would start to signal the decline is resuming. Meanwhile, extending the bounce above 2914.50 would target 2920.00 or higher.

Post-open buyers are scarce.

The overnight rally up to 2921.25 had ranged sideways for 5-1/2 hours into the open. The series of higher highs and higher lows was maintained, so the overnight in its entirety still qualifies as trending. Relentless trending. But its sponsorship was ready to pass the baton.

Fluctuating sideways around the 2919.00 bias-up target through the opening 15 minutes of volatility wasn’t itself predictive. No pattern was formed, other than the inability to extend above the bias-up target. Overnight sponsorship wasn’t attracting intraday reinforcements.

Price began slipping and has tested the 2913.00 bias-up signal down to 2911.50. Its test should define the window’s lower-end, this being a bias-up environment. Probing under it before the window lapses would require its retracement.

Already having been met, the 2919.00 bias-up target won’t become unfinished business if left outstanding. But the 2919.25 opening print and the 2921.25 “new Globex trend extreme” both want to be retested intraday. Back above 2915.50 would start to signal their tests underway.