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…
Thursday night’s rally had peaked at Friday’s opening bar, 1 tick short of its 2680.75 bias-up target. Reversing down under its 2672.00 bias-up signal had put into play only a test of its 2654.00 objective — which was fulfilled at the morning’s 2651.00 low — but its 2648.25 bias-down target was met anyway during the afternoon’s drop. Despite getting sucked into the air pocket under Thursday’s range down to 2645.00, the close recovered back above 2654.00, like the morning, and prevented signaling a “hold-short.

Overnight action’s new info…
Bombing Syria during the week would have likely sent the market down sharply. Waiting until after Friday’s close at least allowed the weekend to pass, a weekend without retaliation. Sunday night’s open gapped up in relief to and through 2672.00 and extended to 2677.50. Reversing down to test 2661.00 stopped 3-4 points short of Friday’s close, which was close enough for Europe’s opens. Much of the reversal was retraced to 2675.00, which is being consolidated down to 2672.00, including a temporary blip-down to 2670.00.

If, then…
Is the overnight rally’s catalyst any more relief that Friday’s salvo may go unanswered? A steady flow of negative news items other than Syria were absorbed last week, so an actual positive development could be a very bullish catalyst. Only closing above 2672.00 would have been bullish last week before probing above it. Extending above Friday’s 2680.50 high could be bullish if maintained through a relevant timing window. But probing last week’s highs and closing back under 2672.00 could be more bearish this week than last week.

First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 above 2668.00 would be likely at least to trigger the 2664.50 bias-up signal at 10:15. Exiting the open above 2675.00 would be likely also to exceed the 2672.75 bias-up target through 10:15 to renew the bias-up 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…
Gapping up Thursday was the only path higher after having failed to gain traction Wednesday. Gapping up above Wednesday afternoon’s 2655.00 bias environment high went further, forming a “session-long rally” setup. Surging through the first hour had already attacked the next higher objective at 2672.00. Two more tests of the objective held through the balance of the session, but their timing still fulfilled the setup’s requirement that all but one window probe its prior timing window’s high. A very last-minute collapse fell 8-9 points into the close.

Overnight action’s new info…
Thursday’s last-minute collapse lasted longer than that. The Globex open immediately spiked down and soon extended the drop to 10-12 points under Thursday’s late lows at 2652.00. Hovering just above this morning’s 2654.00 bias-down signal began firming by midnight, and had retraced the initial drop into Europe’s opens. The recovery extended into positive territory, already probing back above 2672.00 by 1 point.

If, then…
The morning following a session-long rally tends to extend higher. Quickly dropping 10-12 points after the Globex open made fresh highs difficult, due both to momentum and to math. Having already recovered the initial overnight drop, both momentum and math are back on the side of probing fresh highs. Gapping up or not could dictate the morning rally’s likely resolution — probing higher highs without gapping up would be doomed to failure. Gapping down is still possible, but would still be likely to rally through the morning. Sell signals will be considered anyway, especially if the bias-up signal holds its test instead of triggering.

First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 under 2669.00 would be unlikely to trigger the 2672.00 bias-up signal at 10:15. Exiting the open above 2673.50 would be likely to trigger bias-up.

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…
Wednesday’s open was greeted above Tuesday’s 2635.00-2638.50 lows. That might seem uneventful, except for the overnight event of having slid well below Tuesday’s range to 2626.00. The probe under Tuesday’s range was isolated to the overnight night, which likely marginalized sellers for the day (it did) and created potential for trending up (it didn’t). Day-two of Zuckerberg’s testimony provided distraction, and the afternoon’s impending FOMC Minutes provided anxiousness. Distraction and anxiousness combined to keep Wednesday range bound essentially within 2640.00-2662.00 for a second consecutive session. A late dip held a retest of the morning’s 2640.00 low, avoiding a much deeper meltdown.

Overnight action’s new info…
The first reaction to Wednesday’s late dip firmed up to 2651.75, barely attacking yesterday afternoon’s 2655.00 bias environment high. That was gradually retraced entirely, into and out of Europe’s opens, back down to 2640.00. Sitting on the precipice didn’t last long as its reaction quickly recovered, to and through the overnight high to probe yesterday afternoon’s 2655.00 bias environment high up to 2656.50.

If, then…
Retesting Tuesday night’s dip to 2626.00 was likely unless Globex rallied overnight to gap up Thursday. Globex is rallying, just in time to still be considered overnight. But it’s only now encountering its first resistance test, so it’s too soon to be reliable. Resistance being tested is yesterday afternoon’s 2655.00 bias environment high, and having trended down into yesterday’s close, gapping up above 2655.00 could form a “session-long rally” setup. Holding a test of 2655.00 could be as bearish as its recovery would have been bullish. So, forming the session-long rally setup without triggering it would likely target an intraday drop to Tuesday night’s 2626.00 low and lower. Otherwise, rallying could be limited to 2672.00 or else extend to 2715.00-2722.00.

First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 above 2655.00 would be likely to trigger the
2650.50 bias-up signal at 10:15. Exiting the open under 2647.75 would be unlikely to trigger bias-up.

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…
Rallying sharply early Monday night had retraced all of Monday afternoon’s 43-point collapse up to 2658.00. Its reaction down to 2638.00 defined the trading range that would last through midnight, and intraday Tuesday — albeit widening along the way to 2635.00-2666.00. No traction was gained for the effort, especially when trending became unlikely during Zuckerberg’s congressional testimony. There was enough optimism to try breaking higher, but the overnight highs held.

Overnight action’s new info…
Probably in reaction to reports of an impending Syria strike, the first Globex move attacked the range’s lows down to this morning’s 2640.25 bias-down target. And then stopped for a long time, hovering optimistically short of yesterday’s intraday lows. Ranging narrowly up to 2644.00, for hours and hours, and well after Europe’s opens did eventually blip-down momentarily to 2637.00. That proved to be a warning shot, as price has collapsed to 2626.00, well under yesterday’s lows, presumably still anticipating intervention in Syria.

If, then…
Having gained no traction for its efforts Tuesday, extending the rally Wednesday required gapping up. That’s not happening. Meanwhile, the likelier scenario of retracing Monday night’s recovery is playing out. Greeting Wednesday’s open under range’s lows isn’t in itself bearish, unless maintained through the open. Any trending likelier earlier rather than later. Price action can become inhibited ahead of the afternoon’s FOMC Minutes. But even its impact may be muted unless containing a glaring surprise to influence price action. Traders may again be distracted by Zuckerberg’s second congressional appearance. Between his likely adaptation after yesterday’s round, and today’s crew trying to one-up yesterday’s inquisitors, promises to offer more gotcha’s on either side of the witness stand.

First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 under 2637.50 would be likely also not to recover the 2640.25 bias-down target by 10:15, renewing the bias-down signal. Exiting the open under 2644.00 would be likely at least 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…
Monday’s gap up to 2619.00-2620.00 reacted down to 2613.00 before reversing up sharply. And a lot. For awhile. Trending up didn’t peak until the afternoon bias environment attacked 2654.00. Then it was all retraced back down to 2610.00 at the close. Friday’s last-minute high was overlapped by almost 2 points, but the gap back down to Friday’s 2603.00-2606.00 close wasn’t even attacked, let alone filled.

Overnight action’s new info…
Globex initially consolidated up to 2620.00 for several hours, then suddenly broke higher during Chinese Premier Xi’s speech. This morning’s 2625.75 bias-up signal and 2635.25 bias-up target each enforced a consolidation. And each consolidation resolved up, eventually surging 4 points through yesterday’s high to 2658.00. Reacting down to 2638.00 held through midnight, defining a range that has contained price action since then.

If, then…
The overnight rally is not surprising, other than its size. I had noted at yesterday’s close and in the Market Wrap that Monday’s drop wasn’t necessarily bearish, and the burden of proof was on sellers. Stopping short of filling the Friday’s gap is not “ineffectual optimism,” because so much of Monday afternoon’s drop developed so late. And sellers didn’t gain traction for their efforts, with only the proxy window trending down. Also, even the session’s 44-point collapse developed in positive territory. Now, about the size of the overnight rally. Already retracing back to Monday’s highs all but requires a rally to probe higher through the open, or else the morning’s high will be in. Perhaps even the session high, as traders turn their focus to the televised spectacle of Facebook’s Zuckerberg giving congressional testimony.

First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 above 2640.75 would be likely also to exceed the 2635.25 bias-up target at 10:15 to renew the bias-up signal. Exiting the open above 2630.75 would be likely at least to trigger the 2625.75 bias-up signal at 10:15.