The First Trade & Pre-open Tour Recording… Delayed reversal?
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…
Monday was the third consecutive downtrending session spent exclusively in negative territory. Sellers were refueled by an overnight rally to the morning’s 2795.50 bias-up target. But the open was already back down at its 2775.00 bias-down signal. The first hour collapsed to 2733.00, which supported a range back up to 2752.00 through the afternoon bias environment. The proxy window finally broke lower to 2722.00, retracing all of last of last week’s rally — before Wednesday’s election results surge, back down to the prior Friday’s close.
Overnight action’s new info…
A brief bounce resolved down to a fresh low at 2719.00, testing what is this morning’s 2720.00 bias-down signal. Not much lower, and also not extended, so easily retraced back up to 2745.00 by midnight. Its reaction down to 2733.00 was just retested, following an interim surge up to 2750.00. That is potentially the head of a Head & Shoulders pattern, with its neckline being 2733.00. The 2745.00 shoulder has been recovered, and is being probed almost too much to maintain the Head & Shoulders form.
If, then… (notes to accompany the Tour recording)
Overnight action contains multiple reversal patterns, waiting to be triggered, all of which can be ignored. Head & Shoulders: Dipping back under the Head & Shoulders 2733.00 neckline would trigger the reversal pattern, targeting a retest of at least yesterday’s lows, and potentially resuming the decline. The pattern doesn’t always reverse price action, and extending higher would entrench the overnight recovery. Leapfrogging over interim resistance at 2739.00-2743.00 at Tuesday’s open would be the quickest signal of rejecting Monday’s decline. Isolation: An Isolation setup would form by avoiding a dip back down to yesterday’s low since it was probed overnight. Session-long Rally: Maintaining and extending a gap up to and or through Monday afternoon’s 2752.00 high would form a session-long rally setup. Otherwise, resuming the decline could reach 2786.00 before its next opportunity to try bottoming again.
First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 above 2743.00 would be likely to trigger the 2738.50 at 10:15. Exiting the open under 2733.00 would be unlikely to trigger bias-up.