The First Trade.
Proper context can start the day with a solid win and make all the difference.
Enter the Chartroom here (pre-open Market Tour begins at 8:55 ET)
Through the prior close…
Thursday morning”s probe of fresh lows satisfied all known selling pressure down to 1982.00, while being sponsored by weak hands, which became trapped through the noon hour”s entry. Rallying 37 points to almost 2019.00 through the balance of the session wasn”t necessarily sponsored by strong hands — the afternoon”s no-bias environment missed two opportunities to be negated on a timely basis (at its 2000.00 signal and its 2008.00 target), and the recovery peaked a couple of points short of its optimal objective. But the session did form a bullish Pivot Reversal, and buyers gained traction for their effort.
Overnight action”s new info…
Initial firming up to 2020.50 was short-lived, and downtrending since then has touched this morning”s 2001.00 bias-down target. A bounce from there attacked 2008.00.
If, then…
Garbage in, but not entirely out: Having gained traction, yesterday”s buyers are assumed to have earned control of this morning”s bias environment. The overnight drop is threatening to invalidate that traction, by gapping down under a prior low like 2001.50. We gave yesterday”s buyers a benefit of the doubt for not needing to revisit 2000.00, so holding its retest would neutralize that potential attraction below. The last supports are yesterday”s 1999.00 opening print, and the 1:20 bias timing window”s 1996.00 low. If the Pivot Reversal isn”t effective soon after the open, then the bullish setup would invert to being bearish — yesterday”s buyers never proved they were strong-handed, and yesterday”s weak-handed sellers did chip away at support. Not extending the recovery could easily default to resuming the decline, which would become a melt-down into the weekend.
First Trade…
Exiting the open at 9:45 under 2004.75 would be likely to trigger the 2008.75 bias-down signal at 10:15. Exiting the open under 1999.00 would be likely also to exceed the 2001.00 bias-down target through 10:15 to renew the bias-down signal. Exiting the open back above 2011.00 would make the bias-down signal unlikely to trigger.