Pre-close View

Reversal”s rally is holding at its target.

The consequence to rejecting this morning”s bias objective was to put into play a test of what would have been the 2080.50 renewed bias-up target. That was met, while also triggering the afternoon”s 2077.00 bias-up signal.

But, wait, there”s more…

That put into play the 2082.00 bias-up target. Or, it would have, but the bias-up target was exceeded through 1:20. That renewed the bias-up signal, putting into play the renewed bias-up target at 2088.00.

And 2088.00 has been met. it was exceeded by 1 point, while still touching 2088.00, and while beginning a wider range between 2085.50-2089.00.

There”s no requirement to trend any higher. No higher objective is in-play, the bias-up environment has lapsed, there”s already been quite a sizable intraday rally, and heavy news from the FOMC is coming tomorrow. If a pullback isn”t merited, ranging sideways is.

Having said that, above 2088.00 there is potential to resume the rally, or at least to probe fresh session highs momentarily. Back under 2085.00 would start to signal a deeper pullback, probably to test 2077.00.

Corrective bounce underway.

Room for noise under 2077.00 down to 2073.00 was probed to 2069.75. The lower probes were still attached to 2073.00 as each leg still overlapped it.

Meanwhile, 1-minute RSI finally began diverging negatively. And although sellers were in control of the bias environment exit back under the noon hour”s low, they didn”t control the final hour”s entry which was back in the bias environment”s range.

Now a bounce is testing 2076.00.

The 2069.75 low was a single breakout from a Descending Triangle that had formed around 2073.00. The breakout reacted up as quickly back to 2073.00. And then higher from there.

This is a “failed Descending Triangle” pattern. Its reversal can be substantial, but it is rarely durable. Its likeliest objective is 2077.00. The decline could resume by reacting down through the 3:10-3:20 timing window or else at the 3:37 position squaring window. Avoiding those windows could delay fresh lows until Monday.

Another bounce plunges from its minimum objective.

This afternoon”s 2095.50 bias-down signal was touched during the noon hour. Holding it through 1:20 signaled no-bias, making it likely to serve as the bias environment”s lower-end.

That was part of a narrow 3-point 2095.25-2098.25 range overlapping the noon hour, which was not considered bullish. At least, not accumulative, so any bounce from it could only temporarily delay probing fresh lows down to 2093.25.

The potential for a false break higher was 2101.00, which a break higher pierced by 2 ticks. Then — repeating the resolution of this morning”s minimally sufficient bounce — Its reaction down accelerated along the way to 2091.50. But the past 20 minutes have been consolidating at the 2093.25 target.

Closing under 2099.25 would essentially put into play 2077.00. Recovering 2099.25 from here and from now would require a steep surge. Otherwise, there”s no requirement to extend down any deeper today, other than to neutralize the low”s oversold RSIs.

The bias environment”s exit at 2:30 was testing the noon hour”s 2108.00 upper-end. The final hour”s entry was testing the bias environment”s 2108.50 upper-end. And fresh highs were probed in between.

This is essentially the formula for buyers gaining traction, but there”s a caveat: This all happened within several ticks of each other, and all on overlapping legs. But we”ll give buyers a benefit of the doubt for gaining traction, since the implication is in-line with the bigger picture scenario.

So, what about the 3-1/2 point plunge back to 2105.50? Good question.

It is aggressive, but its timing is suspicious and it is holding prior lows. Closing back above 2109.00 would confirm it was just last-minute jitters before today”s post-close earnings, worried about more AAPL-style reactions.

Regardless, it”s too late for any rally leg to actually reverse the trend up. At this late stage, price action can only undermine the decline, or extend it.

Now there”s also unfinished business below.

This afternoon”s 2111.00 bias-down signal triggered cleanly. Bouncing 5 points into the bias environment”s exit tested 2113.00, which would have easily invalidated the bias-down but for one thing — the bias environment had already produced fresh lows after 1:20. So, the 5-point bounce was 1 point too low.

In fact, that bounce was retraced back down to within 2 ticks of the 2108.00 low. That didn”t extend to resume the decline. Swings continue overlapping 2111.00. But 2105.50 is unfinished business below that requires an eventual test.

Nothing is preventing 2105.50 from being met today, but it is getting a little late not to have broken lower yet. Nothing is preventing 2105.50 from being met overnight, either. Its reaction could rally enough to gap up at tomorrow”s open.

Regardless, the sponsorship of today”s decline is known already to be weak-handed. This morning”s no-bias trending under its 2117.50 bias-down signal has yet to be retraced, and this afternoon”s bias environment exit and final hour entry didn”t trend down under support.