Day Trading Trading Signals - 10-16-2015

FRI morning signal (triggered at 10:15 ET) SPX ES Bias-up: above  2027.00 2019.50 ...would target  2032.75  2025.25 Bias-down: under  2018.50  2011.00 ...would target  2013.25  2005.75 Signal status: LATE NO-BIAS, TESTED BIAS-UP 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.

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... Thursday's gap up grudgingly triggered its 1995.50 bias-up signal and grudgingly fulfilled its 1999.50 bias-up target. Exiting the bias environment back under its fulfilled bias-up signal down to 1989.50 indicated that grudging sponsorship was gone. But sellers proved to be more grudging than the morning's buyers, and could not be attracted at all. So, a much more willing round of buying emerged, taking the noon hour to fresh session highs. The afternoon's bias-up environment extended the rally to fulfill its 2007.50 bias-up target. And the rally extended through the cash session close to touch its ultimate objective at 2019.50. Overnight action's new info... An early thrust higher tried to reignite the afternoon's magic, and did touch 2023.00. But soon began reversing down to 2016.00. Bouncing back up to 2022.00 has been reversed down to lower lows testing 2014.00. If, then... Trading choppily overnight is proof that yesterday afternoon's rally was a function of today's expiration. That's interesting, since it fulfilled a significant upside objective at 2019.50 and WedEX is forecasting a bearish afternoon. Meanwhile, this being expiration, trending through the opening 15 minutes of volatility can forecast trending throughout the day. And this being a Friday, the morning's bias tends to persist through the noon hour. First Trade... Exiting the open at 9:45 above 2019.50 would be likely to maintain that recovery through 10:15 to trigger bias-up. Exiting the open under 2016.00 would be unlikely to trigger the 2019.50 bias-up signal at 10:15. Exiting the open under 2007.50 would be likely to trigger the 2011.00 bias-down signal at 10:15.

Is the rally really ending without a fight? Yesterday afternoon's rally gained traction for having exited the bias environment above the noon hour's high, and for then entering the final hour even higher. For that reason alone -- at least, since that traction wasn't invalidated through the open -- I'm still expecting this morning to probe fresh highs. Probe fresh highs... again. The open already probed fresh highs, surging to within 1 tick of 2024.00. But that doesn't qualify as a reward. And if it had, then a deeper downdraft would be obvious by now.

The only downdraft was a brief probe under yesterday's 2017.00 cash session high. It's trying to recover, but still being overlapped. The rubber band was stretched, but it's not exactly "snapping" back up.

Back above 2018.50 would signal and above 2020.50 confirm that a probe of fresh session highs above 2024.00 is underway. This could negate the morning's "late no-bias"  signal that is otherwise targeting an offsetting test of the 2011.00 bias-down signal. This afternoon could be a different story. I think this afternoon will be a different story -- with the bearish WedEX now accompanied by the opening 15 minutes of volatility having trended down. But afternoon bearishness would be difficult if there is any attraction outstanding above.

FRI afternoon signal (triggered at 1:20 ET) SPX ES Bias-up: above  2030.00 2022.50 ...would target  2035.50  2028.00 Bias-down: under  2023.50  2016.00 ...would target  2018.50  2011.00 Signal status: 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.

Hovering in positive territory. This morning's choppy ranging wasn't much different from the overnight action. Neither was it very rewarding to yesterday's buyers for having gained traction. But fresh highs were probed, and positive territory was maintained throughout the morning. It's time for the bearish influences to make themselves apparent. A bearish WedEX has been waiting in the wings, salivating at the rising prices. Its influence this afternoon need not be dramatic, and can simply force rally efforts to fail. This morning's opening 15 minutes trended down, which also need not have a dramatic influence, but suggests the afternoon will print lower lows. Between the two bearish influences, a flat-to-lower afternoon is likelier. An aggressive drop is possible. Yesterday's 2017.00 cash session high is now being probed again. Back above 2020.50 would suggest fresh highs will be probed regardless.

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 Sep Contract (EC, ETF: (FXE, UUP)) Friday's ranging around Thursday's 1.1370 lows still didn't reverse the trend down, and allows the rally to resume at any time. Gold Dec Contract (GC, ETF: (GLD)) Reacting down overnight into Friday's open thoroughly tested the 1179.50 pullback limit, which keeps alive potential for a fresh high that fulfills the 1195.50 target. Silver Dec Contract (SI, ETF: (SLV)) Dipping again in sympathy with Gold has still not reversed the trend down. Extending higher modestly would be toppy, while an aggressive probe of fresh highs would be much more reliable for extending higher. 30-year Treasury Dec Contract (US, ETF: (TLT)) Friday's "inside day" didn't reverse the week's bounce to resistance, but neither was the bounce confirmed. The sell signal remains at 158-04. Crude Oil Nov Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short)) Gapping up Friday to test 47.40 was recovered after an intraday dip, but it stopped short of rejecting the two prior sessions' pessimism. Back under 46.10 would signal a new downleg underway. The bounce can otherwise extend up to 49.05. Natural Gas Nov Contract (NG, ETF: (UNG, UNL)) Thursday's reaction down didn't hold 2.44 Friday, and extended down to the two-week old prior low at 2.41. Any immediate bounce here would be considered only obligatory and temporary and likely to fail.

The bearish WedEX was influential Friday until the final hour. That's when the last relative high at 2023.00 was exceeded, and its recovery was maintained through the close. The close extended up to 2026.00. Absorbing the fresh high back under 2023.00 at Friday's close would have maintained the bearish WedEX's potential. Now it's too late for that. Absorbing Friday's late surge must be signaled by Monday immediately breaking back under bias environment's 2012.75 low. At least, back under the noon hour's 2015.75 low.

Maintaining a gap open under the bias environment's 2012.75 low would also form a "session-long decline" setup. The bearish WedEX would likely compound the reversal, targeting the week's 1982.50 low. Any shallower opening weakness would more likely recover and resume the rally.

Details and other markets coverage are discussed in the post-market Wrap recording here: https://roddavid10.mitel-nhwc.com/join/fbkcbwz

REMINDER: This weekend's Saturday Review begins at 9:30am ET. We'll discuss the bigger picture targets for extending higher and the setups for reversing down. We'll also review any stock chart requests:  XP-Friendly   ||   non-xp ilinc

MON morning signal (triggered at 10:15 ET) SPX ES Bias-up: above  2034.00 2026.50 ...would target  2039.25  2031.75 Bias-down: under  2025.50  2018.00 ...would target 2020.50  2013.00 Signal status: NO-BIAS, TESTED BIAS-DOWN SIGNAL 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.