The First Trade… Firming into the news.

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

CHARTROOM LINK
(pre-open Market Tour begins at 8:55 ET)

Through the prior close…
Is optimism bullish, when it doesn’t get anywhere? Wednesday’s session was spent almost exclusively in positive territory. The session made higher lows throughout. But positive bias gained no traction, while all price action was contained within Tuesday’s late-afternoon range up to 1982.00. And “unfinished business below” was left outstanding at 1968.00 (basis Jun).

Overnight action’s new info…
China’s econ reporting triggered a surge to fresh highs testing 1986.00. Reversing down attacked 1977.00 ahead of Europe’s opens, but a complete recovery tested fresh highs above 1987.00. Now a break higherhas touched 1989.50 as the ECB policy statement and subsequent Mario Draghi press conference are looming closer.

If, then…
Answering my own question (whether optimism is bullish when it doesn’t get anywhere), no. That doesn’t prevent trying to extend, but bases built by weak-handed buyers don’t often launch durable rallies. And not necessarily by reacting down immediately to this morning’s ECB events — a surge testing 1991.50 or new recovery highs up to 1999.50 would remain vulnerable to failure. Like last Friday’s reaction to payrolls, which reversed a large pre-open surge, but this time without recovering it. All of which assumes already rejecting a recovery through a relevant timing window, because otherwise a much higher high could develop… [The front-month rolls forward from Mar to Jun at this morning’s open.]

First Trade…
Exiting the open at 9:45 above 1990.00 would be likely also to recover the 1987.00 bias-up target through 10:15 which would renew the bias-up signal. Exiting the open at 9:45 under 1986.00 would be unlikely to renew the bias-up signal. Exiting the open under 1877.00 would be unlikely to trigger bias-up.