Pre-close View

Probing fresh highs, with almost no momentum.

Having gapped down in an uptrend, this afternoon’s probe above Friday’s ~2013.00 high creates the basis for a bearish setup. Bearish, if it’s exploited, when the simpler path is to extend higher.

Exploiting the bearish setup would reverse back down to close under this morning’s 2002.00 low. The resulting setup would be a “Pivot Reversal,” which tends to be bearish almost immediately and substantially.

It’s getting late for reversing down. A drop would have to be apparent very soon, if not already. In fact, the last half-hour is being greeted at yet another post-open high at 2015.00.

The prevailing trend always gets a benefit of the doubt. But don’t be too dismissive of a sudden reversal back under 2011.00 during the Position-Squaring window that’s about to open.

Retracing the no-bias trending could stop the music again.

This morning’s drop under its 1981.75 bias-up signal originated during the bias-up environment. That’s “no-bias trending” and it requires being retraced back to the bias signal. That seemed difficult when the afternoon bias environment was entered at 1958.00.

But rallying since then is testing 1977.00. Overbought RSIs there suggest its reaction down to 1973.50 will be recovered, perhaps to test 1981.75.

Nothing requires retesting 1981.75 today. If retested, nothing requires its resistance to hold. Often after no-bias trending, the 10:15 print is also retraced, which today is 1990.00.

But a durable downleg is unlikely until at least retesting 1981.75. And nothing prevents starting it from there.

Recovery still elusive, but capitulation is still hiding.

This morning’s plunge to 1978.00 had recovered to its 1991.00 origin as the bias environment began lapsing. Ranging sideways into the noon hour never extended higher. The recovery wasn’t exploited.

Dipping into the afternoon bias timing window attacked 1982.00. The bias environment mimicked this morning’s action by also refusing to extend down.

Price action has remained within the noon hour’s range. Firming back up to 1989.00 was temporary, reacting down, trending down several points but not to new lows.

Unless a rally were to gain traction, the door remains open to price collapsing. Multiple opportunities have been ignored, but it’s getting so late in the day that an actual attempt to rally might not be credible.

Afternoon slide is lacking emphasis.

It has been relentless. Ever since the bias environment retested fresh session highs at 1993.00, price has trended down sharply. Now testing 1979.00, within 5 ticks of this morning’s low.

That’s too close to the morning’s low not to probe it. Eventually. Perhaps today, but not necessarily. Even the most bearish scenario can delay the capitulation — steep, deep trending — until tomorrow morning.

Regardless, this afternoon’s downtrending drop is not accumulative. But if short, don’t be too dismissive of too much of a bounce for too long, as a bigger bounce could develop before tomorrow morning — or the capitulation could be avoided altogether.

Failed fresh highs maintaining the topping setup.

Attacking this afternoon’s 2004.75 bias-up signal to within 1 tick had reacted down quickly to 1995.25. The next half-hour ranged sideways around the 1997.50 bias-down signal.

Coming within view of the bias environment lapsing allowed the bias environment’s range to break. Which it promptly did, attacking 1988.00, where oversold RSIs have produced a bounce attacking 1993.00.

The topping setup doesn’t allow an overt attempt at trending down today. A slightly positive close at or above 1995.00-1997.50 would be optimal. Having gapped down, closing under the 1984.50 pre-open low would form a sort of pivot reversal which would also qualify. Either setup would be expected to start trending down Tuesday afternoon or Wednesday morning.

The potential topping would remain intact in case of a slightly lower close  that is neither positive nor under the morning’s low. The schedule would become delayed while awaiting a higher close, another slightly higher close with a little more room above.