Post-open Review

Bouncing prematurely.

If the overnight rally wasn’t going to produce a gap up that could rally into Tuesday, then another path higher was still available. But it necessitated dipping deeply first. And only briefly. Extending the overnight drop to test 2570.25 pre-open was a big part of that deeper dip. But it was too brief to produce a reliable base. And it was only pre-open, not intraday.

Testing any part of 2566.75-2568.50 post-open and recovering 2570.00 through a relevant window would have trapped shorts, and refueled buyers for a bigger rally leg. Bigger, and steeper, likely to reverse almost straight up.

Instead, the pre-open attack on 2570.00 was already recovering pre-open. The opening bars chipped away at this morning’s 2574.00 bias-down signal’s resistance. Meanwhile, price was reversing almost straight up to already attack the 2572.75 bias-up signal within 2-3 ticks.

An offsetting test of the 2582.75 bias-up signal would have been put into play once 2574.00 had held as support through 10:15. This morning the offsetting test was already fulfilled before being triggered. But it could have been exceeded, and wasn’t. The bias signals should define either end of the window if tested — at least, until the bias environment lapses or comes within view of lapsing 10-15 minutes earlier.

Gap down fails to recover.

The overnight drop to 2571.50 had retraced 61.8% of the rally from yesterday afternoon’s 2563.50 low. Its reaction ultimately greeted the open at this morning’s 2577.00 bias-down signal. A wide opening range up to 2579.25 has dipped as low as 2573.00.

The choppiness isn’t trending. Other than scratching out lower and lower post-open lows, above the overnight low remains intact. And the bias signal triggered noN-bias, which is to say it didn’t trigger. Which is to say no lower objective is in-play, and there’s no limit to a bounce.

That said, the 61.8% retracement could be constructive, clearing the pattern of weak-handed sellers. Could be. But not yet exploiting it through the open starts suggesting it won’t be exploited. Fresh lows into the 2566.75-2568.50 area may be unavoidable, and then fresh lows if that test doesn’t recover 2570.00. Otherwise, back above 2580.25 would let the afternoon probe into positive territory.

Support holds an extended decline.

The overnight drop extended pre-open down to 2575.50. Its reaction touched this morning’s 2580.25 bias-down target as resistance, and greeted the open at 2577.00. Bouncing back up to 2580.25 held as resistance again, briefly dipping to 2574.25, but reacting back up to 2580.25 in time to avoid renewing the bias-down signal.

Not renewing the bias-down doesn’t prevent resuming the decline. This is still a bias-down environment. In fact, extending up to 2583.00 has reacted down to attack 2577.00.  And under 2575.50 would confirm the trend is down, probably into the weekend.

Meanwhile, holding a test of “lower prior highs” at 2577.00-2578.00 through the open can be the bottom that I described during this morning’s Market Tour. Back above 2581.50 would start to signal momentum reversing back up. Entering the noon hour back above the morning’s 2586.00 bias-down signal would be helpful confirmation, but not necessary.

Opening dip holds.

The bullish premise for this morning’s open required quickly recovering above 2587.50. Not already rallying at 9:45 wouldn’t have been bullish. More so, sellers would likely have been productive by then already. There wasn’t a recovery, and sellers were productive. But not durably.

The 2584.50 open had blipped-up 5 ticks and then reversed down into and out of 9:45. Extending down to 2581.50 reacted back up to the opening highs. The 2582.75 bias-down signal held its test to trigger no-bias.

It’s too late to reject the no-bias signal through 10:30. Still, back under 2582.75 (being touched now) would start to signal fresh lows, anyway — but from a position of strength that is likely to recover. Otherwise, an offsetting test of the 2589.25 bias-up signal is in-play.

Post-open rally fails, too.

A pre-open dip to 2586.75 had pierced the overnight low. Rejecting the overnight probe above yesterday’s high should have been easy, if that’s what the market intended. It did not.

Already greeting the open back up at 2589.00 became likelier to retest the 2593.50 overnight high’s “new Globex trend extreme.” At least at some point today. It was touched already before the top of the hour.

Already having neutralized the new upside attraction, the rally depended greatly on triggering the bias-up signal. It did not. Obligatory resistance at the overnight high has pushed back down.

The overnight low is being pierced again by 1 tick down to 2587.00. It’s too late for that to reverse momentum down as the setup would at the open. But having held a test of the bias-up signal, an offsetting test of the 2583.50 bias-down signal is now in-play. Otherwise, exiting the morning bias environment back above 2590.50 would suggest the reversal down will wait for another probe of fresh highs.