The First Trade… New Year’s bash coming early?
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…
Thursday’s open was greeted at the upper-end of an overnight range that had been resisted by 2247.00. A brief overnight low had neutralized the attraction below at 2243.00. The open popped up to touch 2250.00. Holding its test through the opening 15 minutes of volatility made the 2248.75 bias-up signal unlikely to trigger. Trending back down into the noon hour probed fresh lows down to 2239.50. That held a test of the afternoon’s 2240.50 bias-down signal, and avoided discovering whether there is an air pocket any lower. The afternoon bias environment attacked its 2247.00 bias-up signal, and the balance of the session ranged sideways. No more “unfinished business below” remains outstanding.
Overnight action’s new info…
Only firming back to unchanged didn’t reverse momentum up. That hasn’t prevented overnight action from trending up. A probe above yesterday morning’s 2250.00 high by nearly 3 points eventually retraced to attack 2248.00 through Europe’s opens. But price is otherwise ranging narrowly around 2250.00.
If, then…
The last unfinished below was neutralized yesterday, but price only returned to unchanged. That’s not momentum reversing up. Now overnight action has firmed further, and the open is currently indicated to gap up to yesterday’s high. That’s not momentum reversing up, either. Avoiding another downleg today will require recovering yesterday’s high through the open, or at least triggering bias-up. The reward could be a 5-7 point air pocket above to 2255.00-2257.00. The alternative could resume the decline, and discover an air pocket below to 2230.00, on the way to 2215.00. There are unusual influences at year-end, unrelated to volume evaporating ahead of the holiday weekend, and unrelated to the normal Friday Factors.
First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 above 2250.00 would be likely to trigger the 2248.00 bias-up signal at 10:15. Exiting the open under 2245.25 would be unlikely to trigger bias-up.