Pre-market Tour

Proper context can start the day with a solid win and make all the difference.

DAILY SCHEDULE
First, watch the pre-open Tour recording HERE <<==
Then, meet in the chaRTroom here by 9:15 ET for updates and Q&A

Through the prior close…
Two probes of fresh highs Sunday night attacking 2947.00 lacked the complexity to label them “new Globex trend extremes,” so they didn’t require intraday retest. That didn’t prevent fresh post-open highs, especially after an overnight dip to 2938.00 was recovered to avoid forming a bearish Globex-flip setup. Two bias-up signals triggered, but only the morning’s 2950.50 bias-up target was met. The afternoon’s 2954.25 bias-up target became “unfinished business,” attacked only to 2951.50. Perhaps it was anxiousness ahead of GOOGL’s post-close earnings that inhibited rallying higher, instead retracing to 2942.00 through the close.

Overnight action’s new info…
The anxiousness was well-founded as GOOGL’s miss plunged 100 points. That didn’t exactly inspire the market, which extended down to 2940.00 through early Globex. Poor economic news from China triggered a spike down to test 2936.00, which was mostly recovered through midnight. That has gradually recovered to attack 2944.00.

If, then… (notes to accompany the Tour recording)
Tuesday’s econ calendar is very heavy with plenty of reports, and Wednesday’s calendar is very weighty with FOMC events. The quarterly earnings onslaught continues, and this stage continues shaping a different profile than the first round of reports. GE just surprised to the upside, but not enough by itself to recover yesterday’s unfinished business another 11 points higher. Several econ reports are staggered through the open that could either help or hinder a recovery. Maintaining an open in positive territory would be a good first step. Otherwise, the unfinished business above need not prevent a sizeable interim pullback — and last night’s probe under both Sunday night and Monday’s lows suggests some sort of pullback is nearing. Regardless, intraday trending will likely become inhibited again this afternoon ahead of post-close earnings due from AAPL.

First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 above 2945.75 would be unlikely to trigger the 2941.50 bias-down signal at 10:15. Exiting the open under 2940.50 would be likely to trigger bias-down.

Proper context can start the day with a solid win and make all the difference.

DAILY SCHEDULE
First, watch the pre-open Tour recording HERE <<==
Then, meet in the chaRTroom here by 9:15 ET for updates and Q&A

Through the prior close…
Thursday night’s narrow sideways range had broken through its 2926.50 upper-end to 2932.00 in reaction to GDP. Having originated 60-90 minutes pre-open, the breakout was reversed back down through the open to the overnight range’s lower-end at the 2919.50 bias-down targte. The reversal attempt failed, likely marginalizing sellers for the day. Separately, holding tests of both bias-down parameters put into play offsetting tests of the 2934.00 and 2940.75 bias-up parameters. They weren’t required to be met because the rejection was late, but their tests were fulfilled anyway. Also met was “unfinished business” from prior sessions at 2942.00 and 2942.75 by Friday’s last-minute surge to 2942.75. The surge came too late for its new high close to create new unfinished business.

Overnight action’s new info…
A painstakingly narrow 2940.50-2943.00 range developed well through midnight before showing any signs of life. It was a brief surge to 2944.75, and then a reaction down to 2941.25. Another surge to higher highs attacked 2947.00, but no less brief, as its reaction down fell to lower lows at 2940.00. And now a consolidation there is probing lower. Now the 2939.35 earlier Globex low is being probed as support. Each of the overnight probes to higher highs was a singular surge, and each reacted back down under Friday’s high. So, neither qualifies as a “new Globex trend extreme” that would otherwise require intraday retest.

If, then… (notes to accompany the Tour recording)
New trend highs overnight that don’t qualify as a “new Globex trend extreme” does not prevent their intraday retest, but it’s not required. No other “unfinished business” above is outstanding, but that doesn’t prevent extending higher anyway. Borrowing (and slightly twisting) Newton’s first law, the uptrend remains intact until a reversal setup appears. And then that setup must make impact. A bearish Globex-flip setup is trying to form, as an overnight probe above the prior 2942.75 intraday high has been reversed to probe under the 2939.35 earlier Globex low. Meanwhile, be aware that Friday-Monday setups are less reliable, and also breaking under the 2935.75 last relative low would be helpful confirmation. If fully formed but not triggered, the setup’s consequence should be as bullish as it could have been bearish, which means influencing the morning’s trend.

First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 above 2946.50 would be likely to trigger the 2944.50 bias-up signal at 10:15. Exiting the open under 2940.75 would be unlikely to trigger bias-up. Exiting the open above 2940.75 would be unlikely to trigger the 2936.50 bias-down signal.

Proper context can start the day with a solid win and make all the difference.

DAILY SCHEDULE
First, watch the pre-open Tour recording HERE <<==
Then, meet in the chaRTroom here by 9:15 ET for updates and Q&A

Through the prior close…
Thursday’s 2928.00 open was on the trajectory of a collapse from 2935.00, coming out of an otherwise sideways overnight range. The first hour fell enough both to renew its bias-down signal, and to fulfill its 2914.25 renewed bias-down target. That was two hours following the last pre-open bounce up to 2935.00, which took 90 minutes to retrace by noon. The balance of the session ranged sideways again, supported by 2930.00, perhaps paralyzed by anxiousness ahead of AMZN and INTC post-close earnings. A last-minute break fell to 2926.00-2928.00.

Overnight action’s new info…
The last-minute break extended down to 2922.00 at the Globex open, and there began yet another narrow sideways range. A brief reaction up to 2926.50 quickly resolved down and extended to attack 2917.00. The extension was recovered by midnight, and soon 2926.50 was also attacked. Its reaction down through Europe’s opens has now recovered back up to 2926.50.

If, then… (notes to accompany the Tour recording)
Yet another narrow sideways range, means another opportunity for the 60-90 minute Globex false breakout setup. Suddenly trending 60-90 minutes pre-open usually retraces back to the overnight range, and often back through it in the opposite direction. Even waiting until the open can reflect weak-handed sponsorship, regardless of its productivity, like yesterday morning’s 21-point collapse that was retraced entirely. Speaking of which, yesterday’s retracement never became a reversal back above the collapse’s 2935.00 origin, but the 2928.00 open was retraced by the bias environment’s exit. That’s another instance (to another degree) of strength that undermines sellers. Undermines sellers, but doesn’t prevent them from attempting to reverse the trend down, like yesterday morning. They’ll need to influence the open and the morning if they intend to influence the day. The alternative won’t necessarily rally, but would be vulnerable to a sudden rally attempt gaining traction — and Fridays are the most vulnerable to sudden trending attempts.

First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 above 2927.75 would be unlikely to trigger the 2924.25 bias-down signal at 10:15. Exiting the open above 2920.75 would be likely to trigger bias-down.

Proper context can start the day with a solid win and make all the difference.

DAILY SCHEDULE
First, watch the pre-open Tour recording HERE <<==
Then, meet in the chaRTroom here by 9:15 ET for updates and Q&A

Through the prior close…
Tuesday morning’s rally to 2940.00 sapped even more energy from the rally than had been suggested by Tuesday afternoon’s narrow ranging down to 2934.00. The sideways ranging persisted overnight to greet Wednesday’s open. The range expanded slightly intraday — but not to fresh highs, only probing under Tuesday afternoon’s lows. Lower and lower lows that tested 2928.00 through the close, perhaps inhibited ahead of post-close earnings from FB, MSFT and TSLA. Both of Wednesday’s bias-down signals held their tests to avoid triggering, putting into play offsetting tests of their bias-up signals. The morning’s 2942.00 objective remains outstanding, although the afternoon’s 2937.50 bias-up signal was already neutralized to within 3 ticks by Wednesday’s late-afternoon high.

Overnight action’s new info…
Globex immediately popped-up to 2932.50 and continued firming to attack 2936.00. An abrupt reversal retraced it all into and out of Europe’s opens. A 90-minute consolidation supported by 2928.00 got the confidence for a bounce. That has proved to be premature, as a 2-hour consolidation resisted by 2933.00 just spiked down to 2927.00 on MMM miss and lower guidance. But the spike was quickly retraced 5 points to where it greeted the news.

If, then… (notes to accompany the Tour recording)
An entire session elapsed Wednesday without immediately retracing Tuesday morning’s rally, which helps to suggest the rally will resume. It’s another version of pessimism, ineffectual pessimism, which is potentially bullish from a contrarian perspective. A deeper retracement first remains possible, still searching for strong-handed buyers — and a deeper retracement first also remains likely, however brief, unless the open has already recovered back above yesterday afternoon’s 2937.00 high. Note that overnight action has essentially been contained within yesterday’s last half-hour range, so breaking either way within 60-90 minutes of the open will likely retrace. Unfinished business at 2942.00 and 2942.75 should help to limit selling pressure, and to attract price higher.

First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 above 2930.25 would be unlikely to trigger the 2927.75 bias-down signal at 10:15. Exiting the open under 2925.25 would be likely to trigger bias-down.

Proper context can start the day with a solid win and make all the difference.

DAILY SCHEDULE
First, watch the pre-open Tour recording HERE <<==
Then, meet in the chaRTroom here by 9:15 ET for updates and Q&A

Through the prior close…
Breaking out from a sideways overnight range tends to be retraced, when the breakout occurs 60-90 minutes before the open. Monday night’s 2908.50-2914.00 range broke higher during that window, but it self-corrected pre-open. This allowed a post-open rally to extend. Which it did, fulfilling its 2926.50-2928.00 objective before the bias environment began lapsing. And then extending to attack 2940.00 into the noon hour. Despite triggering the afternoon’s bias-up, there was no momentum either way. The balance of the session ranged narrowly sideways between 2934.50-2938.00. The 2942.75 bias-up target becomes “unfinished business,” and the session qualifies as a breaking still needing a second consecutive higher close Wednesday to confirm.

Overnight action’s new info…
Two wrongs don’t make a right, and two ranges don’t make a single range, despite being contained within a prior range. Like yesterday afternoon’s narrow sideways range, which has contained last night’s price action. But last night’s price action can be segmented into at least two ranges. First, the ranging narrowed for a couple of hours, hovering in a 2-point range and still attacking 2940.00. Trending down into midnight then entered another narrow 2-point range testing 2932.00, but at the lower-end of Tuesday afternoon’s range. Its retest after Europe’s opens launched a recovery that is now attacking the range’s upper-end.

If, then… (notes to accompany the Tour recording)
S&Ps are now attacking prior highs. The underlying cash index came within 4-5 points of its ~2841 Sep 21 high. Futures then were trading at a 5-6 point premium, now equivalent to 2646.00-2647.00, and the current equivalent is 2844.00. While those are likely to influence price action if tested, there’s no reason for the market to have come this close to the highs without ultimately probing higher. But the path there is never assured, especially when ranging develops just short of resistance. Regardless, this is “ineffectual pessimism” that is potentially bullish from a contrarian perspective. We’ll apply setups derived from the opening print and bias parameters to help determine likely resolutions.

First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 under 2929.00 would be likely to trigger this morning’s 2933.25 bias-down signal. Exiting the open above 2936.75 would be unlikely to trigger bias-down. Exiting the open under 2937.50 would be unlikely to trigger the 2942.00 bias-up signal.