The First Trade & Pre-open Tour Recording… Fool me twice?

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 night had rallied through Europe’s opens to attack 2668.00. Reacting down to 2552.00 defined the balance of price action overnight, and through Thursday’s close. The sideways session’s only expressions of sentiment were separate rallies to 2672.00, and their two reactions down. The separate rallies each failed to extend, while their reactions down fulfilled targets. Bouncing off of the targets formed “V” bottoms that never paused to allow any accumulative behavior. Fluctuating around 2660.00 resistance was ongoing into the close, undermining whether a next higher objective was put into play.

Overnight action’s new info…
Markets are usually constrained ahead of an Employment Situation report. Last night’s Globex started that way. It had barely begun trading, and could barely be characterized as trending, when it got ambushed by a $100 million tariff on China. Plunging 40 points within 15 minutes fell to 2620.00. Reacting up to 2637.50 into and out of midnight formed an Ascending Triangle. Already breaking higher to 2644.00 ahead of Europe’s opens has extended to attack 2649.00. Its reaction has fallen back down to the triangle’s 2637.50 upper-end as support, probably sparked by headlines that China is within 1-2 hours of announcing its retaliation.

If, then…
Will Thursday night’s plunge set a pessimistic tone for the day, or will its excessive pessimism prove bullish from a contrarian perspective? Tuesday night’s 57-point slide scared a lot of market participants, yet it was reversed well above its origin intraday Wednesday. Will that pattern repeat today? The influence of Friday Factors on sizable overnight moves tends to exacerbate them as weekend illiquidity fast approaches. The question is whether that influence will be applied to the overnight drop, or to a post-open recovery attempt. Meanwhile, Wednesday closed barely under 2644.00 and Thursday closed barely above 2660.00. Closing back under both on Thursday would have signaled the trend reversing down. That applies equally on Friday. The overnight plunge to 2620.00 seems to make that easier, but so did Tuesday night’s 57-point slide. Anyway, closing under 2644.00 or above 2660.00 would likely be by a wide margin.

First Trade…
[Click here to view the Bias parameters] No preliminary levels are considered ahead of an Employment Situation report.