Post-open Review

Overnight slide extends post-open.

Early sponsorship didn’t agree on this morning’s resolution. Exiting the opening 15 minutes beyond either end of 2809.00-2813.00 would have made the 2811.00 bias-down signal more or less likely to trigger at 10:15. Opening at 2809.00 and bouncing to 2813.00 was still overlapping 2811.00 at 9:45.

2811.00 was still being overlapped on the way down to 2800.25. Its reaction recovered back above the 2804.00 bias-down target in time to avoid renewing the bias-down signal.

Holding the bias-down target’s test through 10:15 often holds it through the entire bias environment. But bouncing up to 2808.00 has reacted down to retest 2804.00 as support. It’s still likelier to hold through the bias environment because this setup often does. But a fresh post-10:15 low under 2802.00 would be entirely credible for extending down, targeting 2791.25.

Meanwhile, back above 2806.25 would start to signal at least an attack on the 2811.00 bias-down signal’s resistance.

The rally isn’t resuming, and barely reversing.

A pre-open dip to fresh overnight lows pierced this morning’s 2807.75 bias-down signal, then bounced to greet the open unchanged at 2812.00. A blip-up to 2814.00 was all the post-open strength that could be mustered. There was no gap up, or even a touch of yesterday’s highs.

Reacting back down then slowly ground lower into negative territory. The bias-down signal was probed by 1 point in time to invoke the grace period. It ultimately held to trigger “late no-bias.” And having held a test of the bias-down signal, an offsetting test of the 2816.00 bias-up signal is in-play.

There hasn’t yet been any new strength above the pre-10:15 high. Without it, the late bias signal can be invalidated by exiting the bias environment under its  2807.75 bias-down signal — which is still being tested.

Exiting the bias environment above 2807.75 would make the 2816.00 objective become “unfinished business above.” Back above 2811.25 would trigger an upleg targeting fresh session highs. And probably also probe 2816.00.

Post-open rally returns to positive territory.

A fresh low before the open came within 2 ticks of this morning’s 2789.25 bias-down target. Rallying into the open and through the opening 15 minutes of volatility was testing the 2794.75 bias-down signal. That had extended to 2798.00 when “no-bias” triggered.

Having held a test of the bias-down signal, an offsetting test of the 2803.50 bias-up signal is in-play. Already probing higher since 10:15 makes the upside objective highly likely to be met sooner rather than later.

Nevertheless, back under the 2795.00 aera would start to signal the bounce had failed. Natural resistance at yesterday’s 2800.50 cash session close is now being touched, after trending up relentlessly for an hour. Any relief rally from Fed Chair Powell’s opening remarks is probably waning.

Reversal into the red has set the tone.

Having probed overnight above the prior session’s high, exiting the open under the earlier overnight low has signaled a bearish morning. Other observations include the overnight high touching what is this morning’s 2709.00 bias-up signal — which is also the next rally’s next higher target in-play.

But that was overnight.

The open was struggling to maintain positive territory, and bounced momentarily back above 2804.00. But the 2803.75 earlier overnight low broke lower through the opening 15 minutes of volatility. As did one of Friday’s last relative lows at 2801.50.

Meanwhile, this morning’s bias-down did not trigger. Its 2797.75 signal wasn’t even touched by 10:15, despite having been in proximity for awhile. Another bounce is resolving down to fresh session lows anyway, but its “no-bias trending” will require retracing 2797.75 before a downleg can be very credible for extending. Having said that, I’d still give sellers a benefit of the doubt.

So far, two tests of 2797.75 have been interrupted by a bounce attacking 2802.00. Its recovery would start to signal momentum reversing up. An offsetting test of the bias-up signal wouldn’t be recovered, since bias-down wasn’t tested in time.

Open easily absorbs overnight reversal.

Probing overnight above yesterday’s high and then exiting the open under the earlier overnight low would have been very bearish. Probing overnight above yesterday’s high and then holding a test of the earlier overnight low would have been as bullish as the other setup would have been bearish.

This morning did neither. And not for lack of proximity. Just for lack of trying.

The 2797.00 earlier overnight low had been probed down to 2795.50 several hours before the open. Its reaction still hovered just above 2797.00 right into the open. But the reaction’s 2801.50 high was retested, and the 2797.00 earlier overnight low was ignored. Neither the setup nor its rejection developed.

That wasn’t in itself bullish, but missing a bearish opportunity is relatively bullish. This didn’t prevent reversing back down anyway, but the burden of proof was on sellers. And they barely touched the 2793.50 bias-down signal. Then failed to trigger it.

Having held a test of the bias-down signal, an offsetting test of the 2804.00 bias-up signal is in-play. Any higher would open the door to 2709.00 and 2713.00. Back under 2797.00 again would not necessarily reverse momentum down, but it would at least suggest another detour to extending the rally.