The First Trade… Not just sound and fury.

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…
Rallying 18 points overnight into Tuesday’s gap up didn’t prevent the open’s 10-point drop to 2129.00. But it did help to absorb it, and almost all of it was recovered back to 2138.50 by noon. The noon hour and afternoon’s no-bias environment hovered narrowly between 2135.00-2137.50 just under the pre-open and post-open highs. The final hour finally started trending — down — meeting its 2130.50 target into the futures close.

Overnight action’s new info…
Initially rallying overnight to 2135.50 held up through midnight. It was all retraced into Europe’s opens, on the way to probing under Tuesday’s lows down to 2126.50. But not for long. A bounce quickly recovered back into Tuesday’s range, briefly probing into positive territory above 2133.00.

If, then…
Enough time was spent Tuesday hovering pessimistically short of retesting prior highs for it to be considered pessimism. That context, and the late drop’s timing, suggest sellers were weak-handed. All of which would be irrelevant if Wednesday’s open were to maintain an immediate break under Tuesday’s low. Having threatened that overnight, recovering to gap up Wednesday would be that much more bullish — gapping up above Tuesday afternoon’s 2138.00 high would form a “session-long rally” setup. Breaking under Tuesday morning’s 2129.00 low to resume the overnight decline would essentially resume last week’s declines, too.

First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 under 2128.50 would be likely to trigger the 2130.50 bias-down signal at 10:15. Exiting the open above 2133.25 would be unlikely to trigger bias-down. Exiting the open above 2137.50 would be likely to trigger the 2136.50 bias-up signal at 10:15.