Day Trading Signals and Strategy - 06-26-2017

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

NEW 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 choppiness had yet again retested the gap back down to the prior Friday's 2430.50 gap. A little lower at the open nearly touched Wednesday's 2428.00 low to within 1 tick. And yet again, price bounced back to the recent range's 2438.00-2439.00 upper-end. Resistance held, having become too late for new sponsorship to break the range. The bias environment exit slid back down to 2431.00, but only as noise, still being too late in the day to break the range. Overnight action's new info... Friday's late dip had reacted up to 2437.00 into the futures close. Sunday night's opening dip briefly probed back under 2431.00, and then reacted back up -- more gradually this time, but back up to 2437.00. Europe's opens were greeted 1 point higher, triggering a surge up to 2441.25. It was a quick surge, and has since consolidated narrowly for the past 4 hours. Now a breakout attempt has attacked 2442.00. If, then... Gaps can be filled only once. Repeatedly retesting the gap back to the prior Friday's 2430.50 close has chipped away at its support. And no test has yet reacted back up to suggest support has held. Gapping up above Friday's 2438.00-2439.00 resistance would serve by proxy to suggest support had held -- gapping up, maintaining the gap up, and extending it through the open. A retest of Monday's 2451.00 high would be targeted, including "unfinished business above" at 2454.00. Forming the setup, but not fulfilling it by maintaining it, would be as bearish as the setup could have been bullish. Quickly retracing back down to last week's lows would be likely. Two challenges to maintaining the gap up: First, one-way relentless overnight trending is vulnerable to reversing at the open and through the morning. Second, Greeting the new week with extreme sentiment is often a sentiment extreme. If those challenges aren't influential by 9:45, the alternative tends to be strong intraday follow-through. First Trade... [Click here to view the Bias parameters] Exiting the open at 9:45 above 2440.75 would be likely to trigger the 2438.00 bias-up signal at 10:15. Exiting the open under 2436.25 would be unlikely to trigger bias-down. Phonetic dictation... good morning and good morning welcome it is Monday it's time for Monday's morning market tour we spent the better part of last week after that is Monday's breakout attempt at new highs the Gap up was not above all prioritized of it so didn't require being retested intraday extended higher the session extended hire two new high that afternoon left outstanding I buy a sub targeted 2454 from that point on we spent the better part of the week first filling a gap back to the prior Wednesdays clothes then for 3 consecutive sessions testing the Gap back to Fridays cuz you really only fill a gap once after that your chipping away at it support if we were turned of this area having left it overnight confirmed back to Friday's late bounce high and then at your UPS opens extending higher to Fresh highs now at 2441 4125 the highest level in three days if we were turned to this area of the Lowe's or the Gap back to the prior Fridays 2430 50 close little offending support obligatory maybe but that's it would be expected on the way down and that's a possibility because of the setup that is trying to recover Byers gained no traction for their effort on Friday we did have this late late break lower and could have extended down it was a little late perhaps it was Friday it wasn't going to extend higher it's reaction up into the clothes largely retraced but just didn't extend it was retraced overnight and then the balance resumed Friday mornings recovery for that matter has that it is trying to resume and it's trying to resume in a way that would enable it to extend hire this morning again since buyers didn't gain traction Friday for their efforts the only way to Rally this morning his to Gap up above the prior High that Pryor High of course is Friday size 24 38 39 area that have been tested over the last several days so by proxy that would qualify that would be valid or credible for extending hire this morning maintained and also extended through the opening 15 minutes of all time preferably that's what it takes to maintain a gap up to be credible here's the problem or the challenge challenge number one yes this break out for instance is false and react back down still a couple hours before the open but has bushes to setup is give at this point just short of True Grit triggering with looks pretty triggered right well timing has to come into play the set up the recovery the Gap has to be maintained and extended as I described preferably through the open if it's not even maintained through the open it becomes as barish as it would have been bullish so it's bullish is this could be which is to be attracted to not today for feel that one little only 54 objective outstanding above as bullish is this could be it would be very bearish for The Gap up to be rejected all of that support chipped away at 24 3050 becomes irrelevant and today rather than rallying 15 points could easily drop 15 points just as much if not more alright let's look at other markets so the really isn't the timing issue to reversing down having said that though it would be very narrow base so as as difficult as that would be to launch a durable recovery it could still launch a break out so the cell signal is still want me to 535 28th crude oil as impatient as this reaction down my setup was attacked with in a dime attacked with in it on Wednesday morning before we acting down to refresh low no follow-through the fresh low on the fresh loaf of the fresh low had a couple of days of basically restrained optimism maybe not so much optimism has certainly not following through the downside so at least for a bounce up to 4490 we're backing and filling would still be needed to form a bottom to complete a bottom this by signal above 4340 is of interest it's been probed overnight can see it's even influential here need to actually close above it and then finally Natural Gas as of as of Wednesday is closed no lower low is required allo allo would be required to be absorbed which it was in reaction to Thursday's eia report and at that point when it was but that a new low close or closed under any prior Lowe's a bottom head for least needed to be sealed need to be triggered by recovering 295 it didn't happen Friday Friday though didn't disqualify and I think about Friday's price action disqualify the bottoming pattern and overnight gapping up and of course.

Higher highs win out over pre-open challenges. One-way relentless overnight trending is vulnerable to being reversed at the open. Greeting the new week with extreme sentiment is often a sentiment extreme. Ignoring either challenge through the opening 15 minutes of volatility -- maintaining the gap, if not also extending it -- tends to extend the overnight trend.

That has happened this morning. And it was necessary to rally this morning, after the prior session's buyers had failed to gain traction for their efforts.

This is also a bias-up renewed environment. The 2443.50 bias-up target was exceeded through 10:15, putting into play 2449.00-2450.00. Any higher would likely also fulfill the only "unfinished business above" at 2454.00. Back under 2443.00 would start to signal a deeper pullback underway. There's room down to the 2438.00 bias-up signal without threatening the bias-up environment. Reversing the trend down is now much more difficult this morning. And extended gaps up tend to print their session high in the afternoon.

MON afternoon signal (triggered at 1:20 ET) SPX ES Bias-up: above 2445.25  2442.50 ...would target  2450.25  2447.75 Bias-down: under  2438.25 2435.75 ...would target  2432.50  2429.75 Signal status: NO-BIAS 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-up target's probe rejected, for now. Gapping up to 2442.25 quickly extended through the 2443.50 bias-up target and held on to renew the bias-up signal. The setup is very reliable for extending higher through the morning, and also for printing its session high in the afternoon. None of which mattered today. Despite holding up through the first hour, price suddenly collapsed down to the 2438.00 bias-up signal. It was soon probed by 4 points, but recovered as the bias environment was lapsing. As it should -- it was still a bias-up environment, so the bias signal should define window's lower-end if tested. The recovery has extended through the noon hour to 2441.50. The bias-up signal 1 point higher wasn't touched. The recovery can extend back to and through the morning's highs. Can, and should, so long as 2437.00 holds as support.

A funny thing happened on the way to new highs... No signal or setup can prevent against counter-trending against it. We can only identify levels that shouldn't break otherwise, and perhaps play the break's counter-trending. And the original pattern's levels remain relevant during the reversal. Rarely does Monday's opening setup not extend higher in the morning and into the afternoon. Whatever the catalyst of the mid-morning plunge, the open's context was not invalidated. Its relevant price levels like the morning's 2438.00 bias-up signal remained influential. And the opening gap's recovery and resumption remain possible so long as Tuesday's open doesn't maintain a gap down. Details and other markets coverage are discussed in the post-market Wrap recording here.

Monitor overnight Globex trading in the chaRTroom here.

TUE morning signal (triggered at 10:15 ET) SPX ES Bias-up: above 2443.50 2441.00 ...would target  2449.25 2446.75 Bias-down: under  2435.50 2433.00 ...would target  2428.50 2426.00 Signal status: LATE BIAS-DOWN 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.