Post-open Review

Late break higher extends. For now.

The 2916.00 overnight high had been retested already, following an interim dip back to yesterday’s 2907.50 last-minute low. The recovery’s consolidation started firming into the open up to 2918.00. Its reaction down to 2914.00 resolved up. And up, and up.

This morning’s 2922.00 bias-up target was exceeded through 10:15 to renew the bias-up signal. The 2927.00 renewed bias-up target was just touched, and is being probed by several ticks.

Absent a fresh low under 2907.50, this morning’s bounce is likely only a temporary correction. Either the bias-up target or renewed bias-up target are candidates for the bounce’s peak.

Meanwhile, maintaining the gap up above 2914.00 and extending above 2919.00 — which had been attracting yesterday’s drop — does help to create a position of strength. It’s not yet certain whether the position of strength’s use will be to help absorb a retest of yesterday’s low, or else to launche a durable recovery above yesterday’s high.

Volatility contained, but not constrained.

Second time wasn’t a charm. The overnight rally to 2928.75 was in proximity to gap up above yesterday’s 2928.25 noon hour high. Like yesterday’s overnight rally, it would have resumed yesterday afternoon’s late bounce this morning.

And like yesterday’s overnight rally, it fizzled. Also similarly, the open was greeted slightly positive.

Unlike yesterday — not that it matters — today’s setup inserted a bounce before ultimately extending the pre-open reversal to lower lows. That bounce attacked this morning’s 2926.75 bias-up signal to within 1 tick. Its reversal to lower lows touched this morning’s 2921.25 bias-down signal.

So, this is a no-bias environment. And having touched the bias-down signal, an offsetting test of the bias-up signal is in-play. Aaand, it’s met. An uninterrupted bounce from 2921.25 just pierced the open’s high by 2 ticks up to 2927.25, neutralizing the upside objective.

Being a no-bias environment, 2926.75‘s test should define the window’s upper-end. It can be probed later, but probably no higher than yesterday’s 2928.00-2930.00 highs. Probing above it during the no-bias environment would require being retraced. Resuming the decline would be attracted back down to oversold RSIs at yesterday’s 2918.25 low, if not further down to “lower prior highs” at 2914.00.

Pre-open rally fizzles.

Yesterday afternoon’s bounce gained no traction for its effort. So, immediately extending the rally today required gapping up above yesterday’s highs. Rallying overnight to test 2934.00 created a 5-point margin.

Not enough.

The open was greeted just 2 ticks under yesterday’s morning’s 2929.50 high. Immediately rallying from there still would have been credible, but the pre-open dip extended down to 2924.00. This morning is a no-bias environment.

The 2930.50 bias-up signal wasn’t touched post-open, so it wasn’t actually rejected, so no offsetting test of the 2921.25 bias-down signal is in-play. Either signal should hold if tested this morning.

Lower lows aren’t required, but there’s room for noise down to 2921.25 which must hold 2919.00 to avoid anything more substantial. Back above 2927.75 would start to signal another rally effort underway, albeit probably limited until the afternoon bias environment starts lapsing.

Sunday night’s range holds through the open.

The pre-open recovery back up to the 2930.00 open didn’t break higher. That prevented an Isolation setup from forming. A post-open ally could have developed anyway, but the pre-open reaction only extended back down to the 2923.25 low.

Reactions up to 2929.00 still overlapped the 2927.00 bias-down target at 10:15 to avoid renewing the bias-down signal. But this is still a bias-down environment. And extending down anyway would next target 2921.25 (not being tested by 2 ticks).

Exiting the bias environment under 2919.00 would start to signal something more substantial underway than this morning’s drop. Perhaps the defensive posturing will continue until the market can become comfortable that China doesn’t have additional retaliatory strikes, other than what it announced already last week. Back above 2927.00 would start to signal a bottom is forming.

Gap up maintains, until it doesn’t.

The pre-open drop back down to the earlier 2938.00 Globex low was absorbed. Its test had developed too early from too high to attract reinforcement. Probing back above yesterday’s 2940.75 high neutralized the threat of a bearish morning.

At least, that bullet was dodged, and now another shot has been fired.

Probing back above yesterday’s high surged through the overnight high’s 2945.50 “new Globex trend extreme” to neutralize its attraction above. Extending to within 2 ticks off this morning’s 2947.50 bias-up target 2-3 minutes pre-open then collapsed to 2942.25 2-3 minutes post-open.

Bias-up ultimately triggered as 2942.25 held above the 2940.50 bias-up signal through 10:15. The bias-up signal was probed by 2 points through 10:30, but still overlapped throughout. That doesn’t qualify as invalidation — which would have been extremely unlikely, having avoided even its threat until well past 10:15. The 2947.50 bias-up target is in-play.

Could the delay extend? Back under 2939.25 would suggest that yesterday 2936.00 last relative low will be tested. But the bias environment must lapse under its 2933.50 bias-down signal to invalidate its bias-up signal.