The First Trade… Watching the fireworks.

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…
The overnight slide had not been dramatic. But it was persistent, extending through Thursday’s open, and through the morning. A bullish headline crossed at a very opportune moment, as the gap back down to Tuesday’s 2143.50 was being filled to neutralize its attraction. Its sudden and steep reaction was also substantial, surging 10 points to attack 2157.00 into the noon hour. Whether anxiousness ahead of the Employment Situation report made the dramatic reaction possible, that anxiousness is probably responsible for inhibiting the balance of the session. Narrow ranging into the close was followed by a blip-up to 2157.75.

Overnight action’s new info…
Being post-close, the fresh high was irrelevant, and it was retraced into the Globex open. Its retracement extended down to 2149.50 as the British Pound flash-crashed. Price action has otherwise been less of a participant and more of an observer to the fireworks, centering around 2149.50 while ranging choppily between 2148.00-2153.75.

If, then…
Having neutralized the attraction below at the gap down to Tuesday’s 2143.50 close, there’s no bullish reason to retest it. It’s less likely to attract price down, but also less likely to offer support if retested — unless its retest were isolated, like only probing it momentarily in reaction to this morning’s Employment Situation report. Meanwhile, the upside potential remains entirely valid, if not also likely, especially after two-three days of “ineffectual pessimism” at 2156.50 resistance. At least an obligatory probe above it has become increasingly likely.

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