Pre-close View

Marginalized sellers still being squeezed.

The noon hour had rallied up to 2033.00 Exiting the noon hour with a dip to 2029.00 recovering above 2030.50 was likely to marginalize sellers for the day. In fact, the 2034.50 bias-up target was being pierced up to 2036.00 at 1:20.

That didn’t necessarily renew the bias-up signal, but I gave it a benefit of the doubt. And the renewed bias-up target at 2041.25 was met as the bias environment began lapsing. Now its reaction down is recovering to fresh session highs at 2048.50.

Marginalized sellers, indeed.

More so, buyers gained traction for their effort. The bias environment was exited above the noon hour’s high and the final hour was entered above the bias environment’s high. Probing higher highs is likely tomorrow morning — assuming too much ground wasn’t covered overnight, or into today’s close.

The ground covered already into today’s close is starting to be a little too much.

Back under 2041.00 would start to signal today’s rally was done, with a pullback targeting 2035.00. Any updated or new signal will depend on how much higher the rally runs, if at all.

NOTE: Market “Wrap” will begin early today at 3:45 so we can discuss the bigger picture (there is no Saturday Review this weekend).

The noon hour rallied. It was entered at 2031.00 and extended to within 1 tick of the afternoon’s 2037.00 bias-up target. But that was retraced entirely, and then some, to test the 2026.00 bias-down signal.

Overlapping 2026.00 within 3 minutes of 1:20 invoked the grace period, which held. But being a Friday, the “late no-bias” signal didn’t enjoy its normal influence. Multiple legs overlapping it probed lower and lower to 2023.00.

Now the bias environment has begun lapsing. Fresh lows are testing 2018.00. The next opportunity for reacting up sharply would be 2015.75. There is otherwise potential down to 2012.00.

Was a bottoming opportunity discarded?

I had described the Lunch Hour reversal setup, which isolates a probe under the morning’s low to the noon hour. Enter and exit the noon hour above the morning’s (~2054.00)  low, rejecting an interim dip to fresh lows.

It might not be the low, but it is often the momentum low. If it’s the momentum low, then the  noon hour’s low can be retested during the bias environment’s exit. But that, too, must be isolated and recovered into the final hour.

The noon hour’s low was retested. But the final hour wasn’t entered back above 2054.00. The noon hour low’s retest isn’t being rejected, not on a timely basis, making it less likely to have been a momentum low.

Sellers are being eerily patient. The noon hour’s 2049.00 low is still being overlapped, and the 2045.50 low of its retest hasn’t been probed since entering the final hour. The final hour vulnerability to a short-squeeze notwithstanding, lower lows are likely.

Inhibitive, prohibitive influences lapsing.

The morning and afternoon no-bias environments were appropriate for the holiday-depressed volume. But now those influences have lapsed. Even the holiday is no longer relevant, as a session’s final hour becomes more about the day coming than the one ending.

The afternoon’s 2073.00 bias-down signal held as support during the no-bias environment. It reacted up to within 1 tick of 2078.00 whose recovery would have launched a new rally leg. And that recovery peaked at 2:30 when the bias environment began lapsing — still trending higher any later would have been bullish.

The reaction down is attacking this morning’s 2069.50 low to within 3 ticks. Breaking lower would have potential to 2062.75 and lower.

Retesting overnight highs.

The afternoon’s no-bias environment lapsed after barely piercing its 2074.00 bias-up signal. Apparently that didn’t strength the rubber band, as fresh highs have pierced the 2078.50 overnight high.

Extending higher would have been more credible this morning. Sapping up, surging, and quickly rejecting a post-open dip were all failed tactics. At least they were tried, and they haven’t let sellers retake control. Perhaps the patience of waiting until now will suffice.

Meanwhile, the shoe has switched feet. Rallying this morning had required being aggressive. Now, trending back down would likely be done aggressively. And retesting yesterday’s 2062.00 low — whether today or tomorrow — would be likely to launch a substantial rally.