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... Monday's session was choppy but only ranged around Friday's close. It was narrower than the overnight range, which was narrower than Friday's range.  But there was at least one predictive feature. The morning's 2120.00 low stopped optimistically short of touching Friday's lows. And it was retested after an intraday bounce had probed fresh post-open highs. The first bounce is potentially bearish from a contrarian perspective. Returning to the bounce's origin all but requires at least an obligatory low. It had become too late to attract sponsorship for breaking lower, making another interim bounce likely, first. Overnight action's new info... Last night's range is wider than Monday's. The Globex open quickly fulfilled the intraday corrective bounce potential up to 2124.25-2125.00. But there was greater potential for extending the corrective bounce overnight. It was fulfilled by only attacking yesterday's 2130.50 intraday high to within 1 point. Its reaction down to 2123.25 bounced 4 points, but that bounce is now reacting back down through 2124.25-2125.00. If, then... Monday's relatively narrow range was disappointing. Especially after Friday's luscious volatility of a failed recovery and its deep drop. But Monday's multiple fluctuations between positive and negative territory kept volatility alive. And last night's range was as wide or wider than Monday. Perhaps anxiousness ahead of tomorrow's somewhat predictable FOMC policy statement has already had a paralyzing effect. Still ranging narrowly through today is a lot of patience to ask of the market. Holding under 2124.25-2125.00 post-open would keep alive the likelihood for a pessimistic dive under Monday's 2119.00-2120.00 lows, retesting Friday's 2112.50 low down to 2105.00, and possibly another 10 or 25 points lower. Avoiding any pessimistic dive today would make a bigger bounce likely, and then its failure. First Trade... [Click here to view the Bias parameters] Exiting the open at 9:45 above 2127.75 would be likely to trigger the 2125.50 bias-up signal at 10:15. Exiting the open under 2124.25 would be unlikely to trigger bias-up. Exiting the open under 2116.00 would be likely to trigger the 2117.75 bias-down signal.

Essentially straight down since the open. Opening at 2125.00 quickly began sinking. The 2124.25-2125.00 intraday resistance held, and the gap back to yesterday's close was filled down to 2119.50. Lower and lower lows have extended down to 2115.50. The 2117.75 bias-down signal defined support momentarily, and now it is defining resistance. Overlapping it at 10:15 has invoked the grace period through 10:30. An optimal "late bias-down" would probe under 2115.50 through 10:30. Probing under Friday's 2112.50 low would allow a bottom to form, but its test is likely to visit 2105.00. And that would be vulnerable to extending down to 2095.00 and 2082.00. Not triggering the 2117.75 bias-down signal at 10:15 might bounce back up to yesterday's 2120.00 and 2120.75 futures and cash session closes. That's also yesterday's "higher prior lows." Further strength than that would be unlikely. Still overlapping 2117.75 at 10:30 would trigger "noN-bias" and have now required outcome today.

TUE afternoon signal (triggered at 1:20 ET) SPX ES Bias-up: above 2123.25  2117.00 ...would target  2128.00 2122.00 Bias-down: under  2117.00 2111.00 ...would target  2111.25  2105.00 Signal status: BIAS-DOWN, BIAS-DOWN TARGET EXCEEDED 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.

The downtrend persists. Not recovering intraday above 2124.25-2125.00 resistance was likely to probe under Friday's 2112.50 low. The open didn't have to actually be at resistance, but it was. And post-open action trended straight down. The 2111.25 late bias-down target was attacked as the bias environment began lapsing. And it was met as the noon hour was entered. Having probed fresh trend lows, a bottom was free to begin forming. Or, not. The next lower target of 2105.00 was just attacked to within 3 ticks. It's also this afternoon's bias-down target, yet to be triggered, but it won't become "unfinished business below" having attacked it to within 3 ticks. And RSIs have been making higher lows -- higher oversold lows, but during the noon hour, which doesn't require a retest. Back above 2108.75 would start to signal momentum reversing up. The signal was just touched while testing the current bounce limit. If a recovery doesn't catch, then the next lower targets are 2095.00 and 2082.00.

Tuesday's close qualified as a hold-long. But I wouldn't tolerate much of a pullback. The short-squeeze from 2091.00 up to 2103.00 eventually extended up to 2108.00, putting into play 2111.25 and higher. The 2115.00 and 2121.25-2122.00 areas could be met, too, all within the context of a temporary correction. Temporary. Not so much because Tuesday's drop bounced from 9 points short of the decline's likely 2082.00 target. More so because of simultaneously oversold RSIs at the 2091.00 low requiring a retest. And that retest would be very vulnerable to extending down to 2082.00 -- or its room for noise down to 2077.50. Wednesday's FOMC meeting may have a bullish influence, just for getting the event and the hawkish wording of its statement behind us. It's too soon to gauge what impact Friday's Employment Situation report may have. 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  2115.50 2109.50 ...would target  2121.25  2115.25 Bias-down: under  2106.50  2100.50 ...would target 2100.75  2094.75 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.