Real Time Market Updates and Trade Signals - 01-30-2015

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...
Thursday morning''s probe of fresh lows satisfied all known selling pressure down to 1982.00, while being sponsored by weak hands, which became trapped through the noon hour''s entry. Rallying 37 points to almost 2019.00 through the balance of the session wasn''t necessarily sponsored by strong hands -- the afternoon''s no-bias environment missed two opportunities to be negated on a timely basis (at its 2000.00 signal and its 2008.00 target), and the recovery peaked a couple of points short of its optimal objective. But the session did form a bullish Pivot Reversal, and buyers gained traction for their effort.

Overnight action''s new info...
Initial firming up to 2020.50 was short-lived, and downtrending since then has touched this morning''s 2001.00 bias-down target. A bounce from there attacked 2008.00.

If, then...
Garbage in, but not entirely out: Having gained traction, yesterday''s buyers are assumed to have earned control of this morning''s bias environment. The overnight drop is threatening to invalidate that traction, by gapping down under a prior low like 2001.50. We gave yesterday''s buyers a benefit of the doubt for not needing to revisit 2000.00, so holding its retest would neutralize that potential attraction below. The last supports are yesterday''s 1999.00 opening print, and the 1:20 bias timing window''s 1996.00 low. If the Pivot Reversal isn''t effective soon after the open, then the bullish setup would invert to being bearish -- yesterday''s buyers never proved they were strong-handed, and yesterday''s weak-handed sellers did chip away at support. Not extending the recovery could easily default to resuming the decline, which would become a melt-down into the weekend.

First Trade...
Exiting the open at 9:45 under 2004.75 would be likely to trigger the 2008.75 bias-down signal at 10:15. Exiting the open under 1999.00 would be likely also to exceed the 2001.00 bias-down target through 10:15 to renew the bias-down signal. Exiting the open back above 2011.00 would make the bias-down signal unlikely to trigger.

Dodged one bullet. From a six-shooter.

The overnight drop eventually extended down to the lowest possible support noted in First Trade at 1996.00. That was yesterday''s 1:20 print when no-bias triggered. Its test and retest before the open launched a rally through the opening 15 minutes that touched 2012.50.

That was so fun, let''s do it again.

Sure! The next 45 minutes dropped throughout. The 2008.75 bias-down signal triggered. The 2001.00 bias-down target wasn''t exceeded until after 10:15, but it was exceeded down to 1996.00.

The first recovery was fun, let''s do THAT again, too!

Okay... A quick bounce has extended up to 2004.00. That''s not enough to assume the recovery dodged another bullet -- exiting the bias environment above 2007.00 would be more credible. But 2001.00  is the minimum.

And now, another bullet: The reaction down from 2004.00 is testing 1997.00. This is getting dangerous ahead of a Friday afternoon, to have already expended so much buying pressure, and so obviously.

FRI afternoon signal (triggered at 1:20 ET) SPX ES Bias-up: above 2013.25
2006.75
...would target 2019.50
2013.00
Bias-down: under 2005.75
1999.25
...would target 2001.00
1993.25
Signal status: NON-BIAS, TESTED BOTH BIAS SIGNALS 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 Mar Contract (EC, ETF: (FXE))
Narrow ranging persisted Friday, offering no new signal..

Gold Apr Contract (GC, ETF: (GLD))
Friday''s rally retraced Thursday''s plunge through its 1274.50 post-open high to 1280.00 and 1283.00. Back under 1273.00  would signal the bounce had ended, and a retest of Thursday''s 1252.00 low was underway.

Silver Mar Contract (SI, ETF: (SLV))
Friday''s bounce to 17.32 retraced a majority of Thursday''s plunge, but still stopped short of gaining upside traction. At least Thursday''s lows should be retested, which will probably not hold on the way down to fresh lows.

30-year Treasury Mar Contract (US, ETF: (TLT))
Friday morning''s momentary touch of Wednesday''s close was as much ineffectual pessimism as was Thursday''s gap down that held above support. The session eventually extended higher to attack its 151-28 objective. Without also closing above Wednesday''s high after probing it intraday, the potential for extending to 152-18 would be invalidated by closing Monday back under 150-14.

Crude Oil Mar Contract (CL, ETF: (USO))
Wednesday''s breakout to a new low attacking 44.00 wasn''t confirmed Thursday, which Friday exploited by surging back up to test 46.25 resistance. Extending higher without delay Monday would be credible for extending higher throughout several days.

Natural Gas Mar Contract (NG, ETF: (UNG, UNL))
Thursday''s breakout to fresh lows is confirmed by a second consecutive lower close Friday, which now requires at least a third eventual lower close.

MON morning signal (triggered at 10:15 ET) SPX ES Bias-up: above 2008.75
2002.25
...would target 2017.50
2011.00
Bias-down: under 1989.75
1983.25
...would target 1983.25
1976.75
Signal status: BIAS-DOWN, BIAS-DOWN TARGET MET 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.

If Friday''s range were any wider... then it might have touched either end of Thursday''s range. Friday''s post-open high to post-open low measured ~31 points. Fun Fact #1: the prior session''s range was 37 points. Fun Fact #2: that represented the last 90-minutes of trending. Fun Fact #3: all of Friday''s range was contained within Thursday''s.

Pattern points... (Setups and technicals)
Friday was an "inside day," biased downward, in a downtrend. Most any other day, that would make it difficult to extend the downtrend. The next day would be likely to rally, or else an immediate probe under prior lows would likely recover into a rally.

Friday''s aren''t as predictive. And regardless of the open''s gap down, the intraday bias was flat until the afternoon''s bias environment began lapsing. That last 90-minute window was greeted at post-open highs, which had just filled the gap back to Thursday''s close.

So, except for that last 90-minute plunge, this setup on most any other day would be likely to extend the downtrend.

Thursday''s pivotal low (the low prior to its actual low) was narrowly avoided. Touching it would have entrenched the afternoon''s downward momentum to ensure absorbing a bounce. That could be bullish, to the extent that the bearish setup was avoided.

The late-morning reaction to the Greece headline''s trial balloon should be a warning that favorable news over the weekend could trigger a bigger rally Monday. Thursday''s bullish Pivot Reversal didn''t produce, but neither was it rejected. Regardless, making it through the weekend without favorable news would be likely to probe sharply lower.

What''s Next... (Outlook and opportunities)
Join us this weekend for the Saturday Review. We''ll cover the broader market -- tracing out the potential paths higher or lower -- and then do instant analysis of your stock chart requests. Click here up to a half-hour before the 9:30 ET start time.