Day Trading Signals and Strategy - 05-11-2015

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...
.Friday morning''s bullish reaction to the pre-open Employment Situation report had gapped up above the critical 2090.00-2095.25 resistance. Higher and higher resistance was tested until the upward momentum finally peaked at 2013.00 through the bias environment''s exit. Sideways ranging into the weekend held 2107.50.

Overnight action''s new info...
Flat-to-lower ranging gyrated  as low as 2105.50, where a surge has now attacked the 2110.50 open. But the overnight range is still relatively narrow.

If, then...
If the open isn''t rejecting Friday''s rally, then it is likely to extend higher -- probably today, if not already this morning. Opening only slightly in negative territory could gain traction by trending down through the open, And still be absorbed. But opening even slightly in negative territory would be unlikely to extend higher this morning. Opening in positive territory and quickly extending through Friday''s high may be the only reliable start to a morning rally.

First Trade...
Exiting the open at 9:45 above 2111.00 would be unlikely to trigger bias-down at 10:15. Exiting the open above 2114.75 would be likely to trigger the 2112.00 bias-up signal at 10:15.

Post-open surge starts too low to cover its hurdle.

Friday''s buyers gained no traction for their efforts. So, extending higher this morning required immediately extending through Friday''s highs, if not actually gapping up to and through them.

But this morning''s 2110.00 opening print was under Friday''s 2111.00 cash session close. It did surge quickly, albeit not immediately, to pierce the 2112.00 bias-up signal. That was also a buy signal, but it was never exceeded higher than its first three minutes. Three times.

The first probe above 2112.00 reacted down to 2109.50, the second reacted down a little deeper, and the third probe up to 2113.50 reacted down to 2105.50.

That last reaction down came after the bias signal had invoked the grace period through 10:30. Having avoided bias-up, an offsetting test of the 2104.25 bias-down signal is in-play. Probing it down to 2101.50-2102.50 wouldn''t be surprising.

Currently, a bounce is attacking 2111.00. Back under 2108.50 would start to signal another downleg in-play, presumably to probe under overnight lows. Entering the noon hour above 2112.00 would instead suggest that sellers are marginalized for the day.

MON afternoon signal (triggered at 1:20 ET) SPX ES Bias-up: above 2118.00
2112.75
...would target 2123.25
2118.25
Bias-down: under 2111.75
2106.75
...would target 2106.75
2101.50
NO-BIAS, TESTED BIAS-DOWN SIGNAL 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.

A daily summary of high-profile members of several complexes... View a more detailed discussion of each chart at the end of today''s Market Wrap.

Eurodollar Jun Contract (EC, ETF: (FXE, UUP))
The reaction down from last week''s 1.1380 target was extended Sunday night. Gapping down Monday to 1.1150 ranged sideways intraday, and closing lower Tuesday would confirm a new downleg in-play -- if not also that the last upleg''s bubble was popping.

Gold Jun Contract (GC, ETF: (GLD))
Choppy action initially held 1182.70 Sunday night, but Monday morning probed sharply lower intraday. It was recovered through the close, but not above 1187.00, so the greater vulnerability remains resuming the decline targeting fresh lows under 1170.00 down to 1150.00-1154.00.

Silver Jul Contract (SI, ETF: (SLV))
16.15 support wasn''t very threatened intraday Monday, and held through the close. It can still be probed by a dime before suggesting that a new downleg may be underway.

30-year Treasury Jun Contract (US, ETF: (TLT))
Having gotten ahead of itself by bouncing so much so quickly from testing 153-10, there was likelihood for a pullback to at least 154-30. Monday probed it much more deeply to attack 154-00. Not recovering 154-30 Tuesday would make 153-10''s retest likely.

Crude Oil Jun Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Despite last week''s pullback to the 58.65 limit ending in a Pivot Reversal, the setup did not immediately launch a rally Monday. The pullback limit did persist, but a temporary intraday dip probe under it can''t be discounted.

Natural Gas Jun Contract (NG, ETF: (UNG, UNL))
Abbreviating the corrective dip under 2.76 Friday in order to extend higher was then extended even higher to gap up Sunday night at 2.91. But Monday morning only ranged narrowly around Friday''s close, before dipping further into the afternoon -- still vulnerable to correcting back down to 2.63-2.67.