The First Trade & Pre-open Tour Recording… Not the warmest welcome back.
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…
Thursday night’s probe above Wednesday’s highs up to 2737.75, fulfilling the likelihood that had been expected anticipated for two days. Its vulnerability to reversing down was anticipated as intraday action, but that already appeared as an 18-19 point slide to 2716.00 before Friday’s open. That also formed a bearish setup whose influence could persist after the weekend, having rejected fresh overnight highs to open back under earlier overnight lows. The bearish influence definitely persisted intraday by leaving “unfinished business above” at 2730.75 after holding a test of the morning’s bias-down signal. The afternoon’s fresh lows at 2713.75 didn’t extend down, which would have been surprising after already holding relevant support on a Friday morning. Bouncing into the close up to 2722.00 ended at 2718.00-2720.00.
Overnight action’s new info…
Sunday night’s gap up to 2730.75 was presumably triggered by news of the N. Korea meeting’s reinstatement. Being “unfinished business above” from Friday, its resistance held until Europe’s opens. Being a knee-jerk reaction to non-financial news, the gap up was retraced down to 2718.25 by Monday morning. The holiday Globex session ended unchanged from Friday’s close. Monday night’s firm open attacked 2725.00 then eventually gave way to 2717.50. Only a brief bounce delayed tumbling through Europe’s opens down to 2690.25, the lowest levels in over two weeks.
If, then…
Friday’s open had rejected the overnight probe above Thursday’s highs by opening under the earlier overnight lows. Unless recovered through the open or the close, the setup’s bearish influence tends to extend through the following open, or else for multiple sessions. Retracing Sunday nght’s gap up can be attributed to that influence, despite the gap’s catalyst being only temporary, since the headline’s retracement didn’t otherwise have any timing element. So, if the setup’s bearish influence is persisting beyond yesterday’s influence, then it’s likely to persist through today. A post-open bounce off of support is still possible, but bounces should resolve down. Isolating the plunge to the overnight is the minimum requirement to abandoning any near-term bearish outlook — not impossible, but requiring a significantly higher open, preferably above 2716.50.
First Trade…
[Click here to view the Bias parameters] Exiting the open at 9:45 under 2701.50 would be unlikely to recover the 2708.00 bias-down target by 10:15, renewing the bias-down signal, and essentially targeting 2683.50 and 2679.00.