Day Trading – Real Time Market Updates - 02-09-2016

Proper context can start the day with a solid win and make all the difference.

CHARTROOM LINK (pre-open Market Tour begins at 8:55 ET)

Through the prior close... Once again, gapping down to new relative lows, and trending down sharply intraday to 1821.75, were somewhat rescued by an afternoon surge back through the open's highs. Monday afternoon's rally started too late to be the product of strong hands, and negative territory was maintained, but overbought RSIs were left outstanding at the 1855.00 high. Overnight action's new info... Monday's closing dip to 1844.00 was retraced almost entirely into the futures close. Then it was extended much deeper overnight to 1832.00. Surging into and out of Europe's open's attacked Monday's late 1855.00 high, and later probed it up to this morning's 1856.50 bias-up signal.. Both reacted down to test 1840.00, currently down to 1837.50. If, then... Buyers didn't gain traction for yesterday afternoon's late rally, so extending higher this morning all but requires gapping up. The complete recovery overnight reflects an ability to extend higher, so probing higher without gapping up is possible -- especially if opening above 1846.00 -- albeit doomed to later reversal. Trending down through the open would target a retest of yesterday's lows, and possibly resume the decline. First Trade... Exiting the open at 9:45 1854.00 would be likely to trigger the 1850.75 bias-up signal at 10:15. Exiting the open under 1846.00 would be unlikely to trigger bias-up. Exiting the open under 1836.75 would be likely to trigger the 1840.00 bias-down signal at 10:15.

Pre-open slide is retraced post-open. I described during the pre-market Tour how neutralizing an attraction can allow price to react in the opposite direction. It had happened overnight when overbought RSIs at yesterday's 1855.00 high was retested overnight, sending price back down. One condition usually isn't sufficient. So, retesting overbought RSIs extended to also test the resistance of this morning's 1856.50 bias-up target. Then price reacted down. And down. This morning's open was greeted with already having retraced yesterday's weak-handed rally, back to its origin. That attraction below had been neutralized. The open's blip-down also touched the 1825.75 support that had attracted yesterday's decline. Then price reacted up. And up. While we're not expecting yesterday's rally to resume -- it originated so late that its sponsorship must have been weak-handed -- there was still room to rally back to the range's highs. In fact, the overnight high was touched. It reacted down soon enough to avoid triggering bias-up (the grace period was invoked, and late no bias was triggered). Now the 1840.00 bias-down signal is being tested as support. Exiting the bias environment at 11:30 back under the 1834.50 bias-down target would start to suggest the decline is resuming -- whether or not today.

TUE afternoon signal (triggered at 1:20 ET) SPX ES Bias-up: above  1854.00 1848.25 ...would target  1859.25  1853.50 Bias-down: under  1840.255  1834.50 ...would target 1835.00  1829.25 Signal status: BIAS-DOWN, BIAS-DOWN TARGET MET FAQ INTRO VIDEOS #1 and #2 1. At 1:20, trading above the bias-up signal or under the bias-down signal would put into play a test of its bias-up or bias-down target. 2. Not triggering either bias signal at 1:20 would be "no-bias," and the bias signals should define the bias environment's range. -- A test of the opposite bias signal would be targeted if one bias signal was tested before triggering no-bias. 3. Touching the bias signal within 3 minutes either way of 1:20 would invoke a grace period through 1:30 to trigger a late signal. -- "Late" signals don't require testing the opposite bias signal, but it's still likely. 4. Still testing the bias signal at 1:30 after invoking the grace period would trigger "noN-bias," with no bias influence.

Bias-down target met, held, and reacted. [This morning's pre-market Tour recording file was incorrect. I had updated its link in the blog post and sent a follow-up post which I'm hearing some did not receive. If you're among them and interested, then here is the Tour.] THE POST-MARKET WRAP WILL BEGIN 15 MINUTES BEFORE THE CLOSE AT 3:45 ET. Reacting down from this morning's test of the 1856.50 bias-up target fell all the way to the 1834.50 bias-down target. Its recovering into the bias environment exit tested 1851.00. Not volatile enough? Sliding from there into and out of the noon hour triggered the afternoon's 1834.50 bias-down target and met its 1829.25 bias-down target (to within 1 tick). And despite this still being a bias-down environment, probing above its bias-down signal just touched 1848.00. As suspected this morning, today's market has no interest in sitting still, and it has a wide range to do it. But it is not trending. It is neither extending yesterday's decline nor is it reversing up. One theory being mentioned in the chaRTroom is Yellen's congressional testimony tomorrow. Regardless, the bias environment is now within view of lapsing 10-15 minutes from now. Extending to either end of today's range would have a better chance at trending through it.

Attacking either end of the range again was likely to probe beyond it. The range's upper-end was the lucky recipient of that attention, Its 1856.50 highs were broken on the way up to attacking 1864.00. Lest that sound the decline's all-clear, a late reaction down attacked 1844.00. Tuesday's super-volatile session was super volatile into its last 20-point drop. Gapping up Wednesday above Tuesday's late high would target Friday's higher prior lows around 1868.00, and probably higher to also test 1888.00. Otherwise, opening under 1840.00 could find the decline having resumed before Fed Chair Yellen clears her throat during her congressional testimony. Details and other markets coverage are discussed in the post-market Wrap recording here.

Monitor overnight Globex trading in the chaRTroom here.

WED morning signal (triggered at 10:15 ET) SPX ES Bias-up: above 1861.25 1855.50 ...would target  1867.00  1861.25 Bias-down: under  1845.50  1840.00 ...would target  1838.50  1833.00 Signal status: BIAS-UP, BIAS-UP TARGET EXCEEDED FAQ INTRO VIDEOS #1 and #2 1. At 10:15, trading above the bias-up signal or under the bias-down signal would put into play a test of its bias-up or bias-down target. 2. Not triggering either bias signal at 10:15 would be "no-bias," and the bias signals should define the bias environment's range. -- A test of the opposite bias signal would be targeted if one bias signal was tested before triggering no-bias. 3. Touching the bias signal within 3 minutes either way of 10:15 would invoke a grace period through 10:30 to trigger a late signal. -- "Late" signals don't require testing the opposite bias signal, but it's still likely. 4. Still testing the bias signal at 10:30 after invoking the grace period would trigger "noN-bias," with no bias influence.