The First Trade.

Proper context can start the day with a solid win and make all the difference.

Through the prior close…

See if you can find the relevant level: Wednesday”s decline hit an important low at 1937.75 during the afternoon bias environment. Its 5-point bounce up to attack 1943.50 was reversed down to 1933.75, and then recovered fully to pierce 1943.50. The relevant level is 1943.50, being a “lower prior high” that has been on the radar among this decline”s potential lows. Two lower lows in the midst of a steep, deep decline thought it to be relevant enough to revisit from below — twice. Closing under it, but above the 1937.75 pivotal low, suggested that this leg”s sponsorship was done.

Overnight action’s new info…

With one leg”s sponsorship being done, the next open will help to define the next leg”s new sponsorship. Overnight action hasn”t yet been very revealing. Narrow ranging tried to firm back up to 1943.50, only to tumble down to 1936.00. That was no more successful, now having recovered to retest 1943.50. Did I mention this is a relevant level?

If, then…

If this downleg”s sponsorship is done, then new sponsorship will change the slope, but not necessarily direction. Trending down sharply at the open would suggest the decline is extending. The overnight dip cleared away support that might slow a post-open drop from accelerating down. Its low wasn”t arbitrary, but a test of support at this morning”s 1936.50 bias-down signal. Rallying above 1943.50 through the open may be the last opportunity for bullish sponsorship to retake control.

First Trade…

Exiting the open at 9:45 under 1937.50-1938.25 would be likely also to trigger the 1936.50 bias-down signal at 10:15. Bias-down is less likely to trigger if the open were exited above 1940.00. Exiting the open above 1943.50 would be likelier to trigger the 1945.25 bias-up signal. Touching 1946.25 through the open must recover it, too, to maintain a bullish open.