Post-open Review

Gap up fails.

Gapping up was only half the battle to trending up this morning. Maintaining the gap up, and extending higher through the open, comprised the other half. All preferably above the 2773.50 bias-up signal. The second half of the battle didn’t win.

Although the opening 15 minutes of volatility did repeatedly overlap 2773.50, the 2775.00-2776.25 overnight highs weren’t probed. Not even touched. Slipping into and out of the 10:15 bias timing window avoided triggering bias-up, putting into play an offsetting test of the 2663.00 bias-down signal.

Extending down to natural support at 2767.00 is producing a reaction up, attacking 2771.00. The opening range’s congestion formed a mass whose gravitational pull could attract price back up to it. Back above 2771.50 could retest 2774.00 as resistance. Any higher could even extend the recovery, albeit doomed to recovery.

Meanwhile, the offsetting test of the 2763.00 bias-down signal remains intact. More so, as the bias signal produced fresh post-open lows AFTER triggering at 10:15.

Post-open volatility still includes bounces.

Dipping overnight to test 2736.00 was recovered pre-open to test 2754.00. The 2750.50 open surged to 2756.00, which had been put into play by revisiting 2767.00 yesterday. Now it had been tested intraday, so closing back above it would signal that sellers were likely done. Its test extended up to 2758.75, but 2756.00 held as resistance through the open.

And now, after an interim dip attacked 2746.00, its reaction up is retesting the 2758.75 post-open high. This sudden optimism seems premature, since the overnight low’s retest has a minimum likely objective of 2738.50. Fresh lows would target 2732.00.

Closing today above 2756.00 is possible without yet fulfilling likely downside objectives. That would create a position of strength to better enable a recovery if another sell-off were attempted tomorrow morning. Or, 2756.00 could be both recovered and already exploited today.

So, until today’s close is above 2756.00, or until recovering 2767.00, bounces are possible, but not likely to be durable.

Gap down being corrected.

There’s no bullish reason to revisit 2767.00. Its test Friday morning launched the intraday rally. Returning to it now only means its rally has failed, and the next lower objective of 2756.00 is in-play. The open’s touch of 2767.00 did extend down to 2761.25, but quickly recovered back to the open.

Rather than resume, the decline has been retraced to test the 2775.00 origin if its last overnight downleg. This being a bias-down environment, its 2777.50 bias-down signal could be tested.

Bouncing back above 2767.00 began too late to be strong-handed sponsorship. But it’s unlikely to be rejected abruptly. Regardless, back under 2771.00 would start to signal momentum reversing down. Otherwise, recovering the bias-down signal could fill the gap back up to Friday’s close.

Gap down only worsens.

The 2775.00 bias-down target held several tests before the open. One of its reactions peaked at the 2782.00 bias-down signal, and still resolved down to 2771.25 before the open. Its reaction only attacked 2780.00 before the open.

Post-open action also repeatedly tested 2775.00. Which was still being tested at 10:15 to avoid renewing the bias-down signal, but neither was its test rejected. And this is still a bias-down environment. In fact, fresh lows touched 2765.50.

A knee-jerk reaction to a non-financial headline triggered that last push lower, which stretched the rubber band to now snap back up sharply. The 2775.00 bias-down target’s resistance is now being probed, and maintaining its recovery would be credible for extending higher. However, it’s being attacked by the first reaction up from the prior trend’s extreme, which has a horrible track record for triggering reversal signals without yet correcting by 61.8%.

2765.50 also tested last Friday’s prior low at 2767.00. There’s one chance for its test to launch a durable recovery. Not maintaining the recovery above 2775.00 and breaking back under 2770.25 would next target a test of the 2756.00 area.

Rallying back to the highs, while it can.

Maintaining the open above yesterday’s 2779.00-2780.00 low was the minimum requirement to isolate the overnight probe below it. Back above the week’s earlier 2783.00-2784.00 lows was preferable. Most convincing would have been to recover 2788.00-2788.75, too, which would also invert the bearish WedEX.

Sooo close.

The first 15 minutes of volatility fluctuated choppily around 2788.00-2788.75. That was on the way down from the pre-open touch of 2790.75, and the first half-hour’s ultimate dip to 2786.25. That was easily high enough to fulfill the Isolation setup. The likely minimum reward is to retrace the prior high, which is yesterday’s 2796.00 peaks. I would expect 2798.00 to be met, too, neutralizing its “unfinished business above.”

The Isolation setup usually backs-and-fills during the morning, before resuming its recovery. Surging up to fresh highs at 2794.00 is already being retraced back down to 2787.00. There’s room down to the 2786.00 bias-up signal, which could be probed temporarily down to 2783.00-2784.00.

The 2786.00 bias-up signal should hold as support if tested, because this is a bias-up environment. Still overlapping its 2793.00 bias-up target at 10:15 failed to renew the signal, and often holds through the morning.

As for recovering 2788.00-2788.75 to invert yesterday’s bearish WedEX, not quite. That’s not a decisive rejection. As it happens, the setup wasn’t triggered decisively, either. So, we’ll keep the door open for a bearish afternoon tomorrow, especially so long as today’s close is back under 2788.00-2788.75.