Post-open Review

Post-open plunge is settling in.

The gradual overnight recovery had probed the gap back up to Thursday’s 2449.75 close by 3 ticks. But the gap wasn’t filled intraday. Not until an opening dip was recovered just high enough to get it done. Just long enough, too. Immediately reacting down slid to 2544.00.

The setup I had described would have done that after probing last week’s high, and not just coming to within 1 tick. So, the pattern is the same, but more pessimistic. Sellers haven’t refueled to their potential, making a shallower low more capable of holding.

Shallower, like 2541.00 instead of 2535.00. A retest of Friday’s 2541.50 low of Friday’s would have room down to 2535.00. Having held a test of the 2549.00 bias-up signal, this morning’s no-bias environment has put into play an offsetting test of the 2541.00 bias-down signal — which today’s low-volume environment will help to hold.

Bounces meanwhile have room up to 2547.50 while keeping alive the downside attraction. Probing under 2543.00 would allow lowering the buy signal.

Payrolls reaction holds the pullback limit.

The narrow overnight range had started ticking lower ahead of the Employment Situation report, touching 2547.50. The news reaction extended down to 2543.25. Another tick lower could have been touched without even threatening the chart’s trending pattern.

Not only touched, but tested. The pullback could probe under 2543.00 down to 2541.00 and still be considered as only noise. But it was only attacked to within 1 tick. So, stopping optimistically short makes the delay suspicious. Back under 2545.50 would target 2543.00 down to 2541.00.

Meanwhile, the delay has bounced up to 2547.50. Almost any higher would likely fill the gap back up to yesterday’s 2549.25 close. And probably also probe fresh highs, including the 2552.00 unfinished business above. Reversing back down from there would form a bearish Pivot Reversal setup, which we’ll explore if fresh highs are probed.

Pre-open new high extends post-open.

Maybe “extend” is too generous. Flat-to-higher seems to be more appropriate lately. Anyway, the overnight 2-point range broke a couple of points higher two hours before the open. Its 2539.75 high reacted down enough to overlap yesterday’s 2538.00 high at the open.

That was extended up to 2541.00, 2 ticks short of the 2541.50 attraction. Coming to within 2-3 ticks prevents it from becoming “unfinished business above” if left outstanding. It has been attacked twice, so ought to be touched regardless.

Meanwhile, 1-minute RSI is barely attacking overbought territory. Back under 2537.75 would signal momentum already reversing down. The trend otherwise remains up, but no less vulnerable to peaking.

PROGRAMMING NOTE: I am unavailable during the final hour today. Market Wrap will be recorded and emailed tonight, along with tomorrow morning’s bias parameters.

Slight gap down isn’t recovering.

Quickly rallying out of the open was probably the only credible bullish setup for this morning. And that didn’t happen. Gapping down a couple of points to test 2530.00 did recover enough to fill the gap from yesterday’s 2532.00-2532.50 close.

That threat of reversing into positive territory reacted by plunging to 2529.00. But pessimism remains in-check, as consolidating there was eventually recovered back up to 2532.00-2532.50.

The very choppy open avoided touching either bias signal, so there is no offsetting test of the other bias signal. This range might be unable to resolve until the bias environment begins lapsing.

A fresh high can’t be discounted, but its base would be suspicious. Some sort of probe into positive territory would be signaled above 2533.00. But back under 2530.00 would start to signal resolving down already.

Still hovering under the overnight high.

The open was greeted in a narrow range around the 2527.50 bias-up signal. A post-open dip finally appeared. It came to within 3 ticks of the 2525.25 objective that would have been likely to hold and to reverse up. If done early enough.

Coming to within 3 ticks at 2526.00 proved sufficient to hold, and to recover. But so far, only to recover, back up to 2529.25. Reversing up is something else. And not at all assured.

I’m still reluctant to sell within the orbit of the overnight high. It’s a “new Globex trend extreme” that requires intraday retest.

But not triggering the 2527.50 bias-up signal has put into play an offsetting test of the 2520.25 bias-down signal. Back under 2525.25 would start to signal that leg is already underway. Otherwise, back above 2528.00 would suggest “no-bias trending” will retest the overnight high.