The First Trade… Pins AND needles.
Proper context can start the day with a solid win and make all the difference.
CHARTROOM LINK(s)
o Win XP-Friendly entry
o non-xp friendly (ilinc)
(pre-open Market Tour begins at 8:55 ET)
Through the prior close…
Wednesday morning’s noN-bias environment extended higher nonetheless, lifting off from the 1970.00 area through its 1977.00 target. The afternoon fulfilled potential to 1985.00 up to 1987.00. The close triggered a bullish WedEX. But buyers didn’t gain traction for the effort — in fact, the bias environment exit was under the noon hour’s low. A post-close surge touched 1989.00.
Overnight action’s new info…
Choppy flat-to-lower ranging has worked its way down to 1981.00 That slightly overlaps the highs of both yesterday morning’s bias environments, while dipping under the noon hour’s 1983.50 highs.
If, then…
The rally satisfied 1977.00 and 1985.00 targets yesterday. Not in the same timing window, and not without a corrective dip between them, but in the same session anyway. So much buying pressure satisfied so recently should naturally devolve into a pullback, even in the most bullish scenario. Anxiousness ahead of FOMC statements can cause a defensive pullback in a hesitating environment. So, it might seem a likely catalyst to profit-taking when there are such great profits to take. Perhaps. But yesterday’s targets were less a product of fulfilling previous optimism, and more of position-jockeying ahead of expiration. No doubt, the recovery is extended, but it’s vulnerable to becoming more extended. Delaying a logical pullback much past the open could spark a counter-intuitive upleg into noon. I’ll be prepared for a morning pullback if that’s indicated, but the market seems intent upon greeting this afternoon’s FOMC events optimistically.
First Trade…
Exiting the open at 9:45 under 1985.00 would be unlikely to trigger the 1988.25 bias-up signal at 10:15. Exiting the open above 1989.75 would be likely to trigger bias-up. Exiting the open under 1978.00 would be likely to trigger the 1979.50 bias-down signal.