The First Trade… Retracing Monday’s rally.

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…
Monday”s extreme sentiment of gapping up to 2065.00 was not a sentiment extreme. The post-open surge quickly exceeded 2069.00 resistance on the way to eventually attacking 2082.00. That fulfilled the afternoon”s bias-up target, while neutralizing overbought RSIs, without buyers gaining traction for the effort. A last-minute reaction down touched 2078.00 at the cash session close, and 2074.50 into the futures close.

Overnight action”s new info…
Initially firming to attack 2077.00 was short-lived. Monday”s last-minute reaction down became an all night imperative. Bouncing 5 points off of 2069.00 has resolved down to test 2062.50.

If, then…
So much for having reduced the vulnerability to extending down? Although Monday”s buyers had left absolutely no “unfinished business above,” the last-minute dip had begun neutralizing selling pressure. Its overnight extension has attracted new selling pressure — but, so far, only overnight. Rallying this morning will require either already recovering considerably before the open, or else extending further down to probe into Friday”s range. Regardless of the opening level, keep in mind that it is difficult for one-way overnight trending to attract intraday sponsorship to extend the trend.

First Trade…
Exiting the open at 9:45 under 2060.25 would be likely also to exceed the 2064.00 bias-down target through 10:15, which would renew the bias-down signal next targeting 2057.50. Exiting the open above 2068.00 would be unlikely to renew the bias-down signal.