The First Trade… Putting the “bigger” into bigger picture.

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…
Tuesday’s gap up to 1952.00 greeted the holiday-shortened week with extreme sentiment. That became a sentiment extreme that required dipping to 1944.00… which the morning promptly fulfilled. Having offset the earlier optimism with a quick dose of pessimism, the rally resumed gradually. Buyers gained traction by exiting the bias environment above the noon hour’s high and entering the final hour higher. The rally extended through the 1961.00 overnight high to 1968.75, closing under the session’s 1967.25 target.

Overnight action’s new info…
The rally soon resumed overnight and extended relentlessly to 1987.50 into Europe’s opens. Trying to resume the rally surged to 1992.00, only to react down to 1982.00. Now 1987.50 is being retested.

If, then…
Yesterday afternoon’s buyers had gained traction, but were already rewarded by then fulfilling the session’s 1967.25 target without closing above it. Not extending higher overnight would have meant reversing down sharply this morning. Having extended higher overnight — no matter how substantially — the rally should be immune to reversing down. This morning’s bias environment is likely to trend even higher, but pulling back instead would then be likely to recover and extend higher this afternoon.

First Trade…
Exiting the open at 9:45 above 1981.50 would be likely also to exceed the 1976.50 bias-up target through 10:15 to renew the bias-up signal, next targeting 1986.00. Exiting the open above 1986.00 would be likely to further renew the signal, next targeting 1996.00. Exiting the open under 1973.00 would be unlikely to recover 1976.50 through 10:15.