The First Trade & Pre-open Tour Recording… [Cue theme from Jaws.]
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 night’s reaction to Gary Cohn’s resignation had gapped down 24 points from the 2724.00 cash session close to 2700.00, then extended down to 2681.00. Wednesday’s open was greeted back at 2700.00, which then recovered to attack 2724.00 to within 1 tick. The open’s gap down was retested into the noon hour, and holding its test was rewarded by recovering to within 1 tick of Tuesday afternoon’s 2730.50 high — which was done by invalidating the afternoon’s clean bias-down signal at 1:30. Last-minute weakness finished a third consecutive session at or near the 2725.25-2727.75 corrective bounce limit.
Overnight action’s new info…
Wednesday’s last-minute weakness drifted only a little lower to 2720.00 before bouncing back to 2727.75. Choppy ranging persisted into and out of Europe’s opens, forming a chart that resembles a shark’s menacing dorsal fin protruding above the water. [Cue the Jaws theme music.] The most recent reversal back into the range has extended through its upper-end, now probing Tuesday and Wednesday afternoon’s highs up to 2733.50.
If, then…
Retesting Tuesday afternoon’s highs was a likely reward for having absorbed Wednesday’s second dip back to the open. The recovery wasn’t rejected through the close, and another test of the corrective bounce limit was held. So, the bearish template is — again — either to reject probes of fresh highs before reversing down sharply, or else to already be collapsing through the open. The latter may seem unlikely now while fresh highs are being probed, but the ECB announcement and Draghi’s press conference are just minutes away. Regardless, extending higher or trending down substantially will be difficult on the day before Friday’s pre-open Employment Situation report. Nevertheless, extending fresh highs Thursday morning would start making fresh highs at 2753.00 or 2765.00 likelier next.
First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 above 2733.25 would be likely to trigger the 2731.00 bias-up signal at 10:15. Exiting the open under 2727.75 would be unlikely to trigger bias-up.