Post-open Review

Backing-and-filling becomes more obvious, hits a vein.

A brief overnight dip had attacked this morning’s 2856.00 bias-down signal. It was retraced back to the 2861.25 overnight high. But not for very long, as another dip fell to 2855.00.

Now a very choppy open has triggered “late bias-down,” putting into play its 2851.00 bias-down target. And fresh lows have developed down to 2853.00. Fresh lows compared to pre-10:15, which is pretty reliable confirmation.

Having said that, the trailing bounce limit was violated above 2854.75-2855.75. And a surge is probing fresh post-open highs at 2860.00.

Back under 2857.00 would reinstate downside momentum. Unless the bias environment were exited above its 2864.00 bias-up signal, this morning’s 2851.00 bias-down target will become “unfinished business below.”

Meanwhile, surging from fresh lows to fresh highs seems like something else is developing. A retest of yesterday’s highs under 2864.00 may be underway.

Gap up maintained, extended.

Gapping up above 2854.25 — and preferably to or around 2856.00 — would exceed the room for noise above yesterday afternoon’s range. Which would create a position of strength. Dipping into yesterday afternoon’s range would still be possible, but likely to recover.

No dip.

Opening at or around 2856.00 surged to 2860.00 and back down to 2856.00. The open only threatened to reverse down, and only momentarily. Rallying through the first hour has extended up to 2863.75, probing the bias-up target by 2 points.

Now the bias-up target’s minimum buying pressure is fulfilled. And the 2-point probe above it includes an errant tick that wasn’t immediately confirmed. Extending higher is possible, but not required. A reaction down has room down to 2859.25 before suggesting a deeper pullback is underway. Extending higher would essentially next target 2873.00.

Overnight and post-open dips absorbed.

Rejecting the overnight probe above Friday’s high would have signaled the trend reversing down through this morning. Or else through tomorrow morning. Reversing down from 2845.00 to 2835.00 had threatened exactly that.

I described during the Market Tour the 8-point surge that relieved the threat. But the threat re-emerged by greeting the open back under the 2840.00 earlier overnight low.

The open’s dip to 2835.50 was recovered anyway — not optimally, not back above 2840.00 at 9:45, but on its way. The 2841.00 bias-up signal triggered cleanly at 10:15 on the way up to 2843.50.

Another dip down to 2839.00 was still overlapping the 2841.00 bias-up signal at 10:30 to avoid invalidating it. It’s still being tested, but bias-up remains intact. More so, failing to trigger the open’s fully-formed reversal setup can resolve as bullishly as it would have been bearish.

Muted payrolls reaction trying to resolve up.

The surprise move by the PBOC had taken the market from 2828.50 up to 2836.00. But only temporarily before greeting the Employment Situation report at 2831.00. Its knee-jerk reaction tested and retested 2727.75 before the open, which was 2828.50.

The first half-hour then fluctuated narrowly, resisted up to 2831.00, and supported by tests of 2727.75. Resolving up invoked the grace period, but ultimately triggered the 2831.00 bias-up signal. Its 2837.50 bias-up target is in-play.

The pre-open high has been attacked to within 2-3 ticks at 2835.50. Its resistance is interesting, and holding its retest through a relevant window could establish an intraday extreme. Stopping pessimistically short of even touching it could keep buying pressure healthy enough to extend the rally this afternoon.

Reversing down is more difficult at this stage. But back under 2831.00 (being attacked now) would start to signal a pullback underway, even if only temporarily to retest the ~2525.00 overnight lows.

PROGRAMMING NOTE: I’m away from screens for today’s last half-hour. Market Wrap will be held 30 minutes early.

A different crowd showed up at the open. The 2791.00 overnight low had been retraced already to attack 2799.00. Opening at 2797.50 immediately blipped down, but only blipped down. Soon, the pre-open retracement was resuming, and at a steeper slope.

2801.50 certainly was not isolated. It wasn’t even touched during the opening 15 minutes of volatility. But it was recovered on the way up to the 2807.50 bias-down signal. Touching it in time to invoke the grace period then extended to 2810.50 triggering “late no-bias.” That’s now being probed up to 2812.50.

Offsetting tests of both bias-up parameters is in-play. Likely, but not a requirement. Even if required, not assured of avoiding an interim corrective dip. Especially since testing 2801.50 was isolated not to the overnight, and not to the opening 15 minutes of volatility but only to the first half-hour. That’s not optimal, so this recovery attempt is vulnerable.

Back under 2707.50 would start to signal a retest of 2801.50 underway. Meanwhile, testing the 2815.50 bias-up signal only 3 points higher would neutralize its attraction.