Real Time Stock Market Trade Signals - 01-04-2016

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

CHARTROOM LINK(s) o New! Omnistream o Anymeeting backup (pre-open Market Tour begins at 8:55 ET)

Through the prior close... Friday's gap down had extended to 2037.00 before bouncing. The bounce touched Thursday's late lows around 2055.00 before returning to the morning's lows. The final several minutes plunged to fresh lows attacking 2030.00. Overnight action's new info... Sunday night's open gapped up and extended higher to 2043.50. That barely attacked Friday's late-afternoon highs. China began crashing, and even that relatively shallow bounce disappeared. Various countries aligning with either Iran or Saudi Arabia through embassy closings probably hasn't helped. The balance of the night has been trended down relentlessly, recently touching 1995.00 and then bouncing to 2001.50. That's basically a 40-point drop. If, then... We discussed air pockets Friday morning. The first one under 2030.00 became obvious during last year's final minutes. The second air pocket under 2029.00 became obvious when China began crashing. The extension from there has leap-frogged several other "lower prior highs" to test one of the last "lower prior highs" remaining. And all of this is retracing in 2-3 days back to two-week old lows. Exiting the weekend with extreme sentiment is often a sentiment extreme. This was the case last weekend, after the morning followed-through shallowly. Exiting this morning's open already bouncing from its 2-week old prior lows would suggest this leg isn't extending, either. Otherwise, while the relentlessness might subside, the direction doesn't have to reverse. First Trade... Exiting the open at 9:45 above 2008.00-2010.00 would suggest the overnight decline's momentum had been absorbed. There is otherwise potential to 1991.00 before putting into play essentially a new leg, perhaps a crash leg greater than August's.

Pre-open low fails to hold. The choppy open has trended down, albeit with wide legs between its lower lows and lower highs. The 1995.00 low's bounce to 2003.50 was retraced almost entirely before the open. Fresh lows down to 1990.50 reacted up to attack 2000.00, but that resolved down to 1988.50. Another bounce is now also failing. Ultimately, the bias timing window has now lapsed into the bias environment. No prior high is recovered, let alone challenged. The bottoming potential has largely eroded. One more line of defense is at 1987.00, and its success would be signaled by exiting the bias environment back above 1995.00. Otherwise, objectives under 1987.00 can be better measured in time than in price -- like Wednesday morning, during which time a lot of damage can be done.

MON afternoon signal (triggered at 1:20 ET) SPX ES Bias-up: above 2005.25 1996.00 ...would target  2010.50  2001.25 Bias-down: under  1991.25 1982.00 ...would target  1983.75  1974.50 Signal status: NO-BIAS, TESTED BIAS-UP 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.

Noon hour bounce trying to position for afternoon surge. This morning's 1980.25 low fulfilled the pattern's structural requirement for a fresh low triggered under 1989.00. That was short of its potential, but exiting the bias environment above a prior high could still trap shorts. The bias environment wasn't entered above a prior high. Not when it began lapsing and not by noon. The noon hour has rallied. It fulfilled a 1997.00 target that was triggered above 1990.25. But the 1996.00 bias-up signal ultimately avoided triggering.Now a dip to 1992.00 is trying to regain its footing. Fresh highs above 1998.00 would suggest the decline is done for now. But triggering any buy signal during a no-bias environment is suspicious and unreliable. Hovering up here for a half-hour and THEN surging would be more credible for extending higher. Alternatively, back under 1990.25 would start to signal the recovery is done. Structurally, it could be satisfied by only a fresh low. But defending against fresh lows is difficulty while exiting the bias environment, which would be the likely timing.

Monday's last half-hour recovered from 1984.00 to the afternoon's 1996.00-1997.00 resistance, with almost 15 minutes to spare. That time was fully exploited by extending to 2005.00 at the cash session close. Not to be excluded, the futures close added almost 5 points more to attack 2010.00. Fresh afternoon lows were being probed into the final hour. The decline from 1996.00 to 1984.00 was tracking a template for buyers "throwing in the towel." And then they ran out of towels. No "unfinished business below" was in-play to inhibit a rally, but there was nothing accumulative about the low. And the late surge did more than retrace a downleg. Meanwhile, a lot of buying pressure was expended -- only to test the 2008.00-2010.00 area, which we discussed selling if tested initially at the open. Details and other markets coverage are discussed in the post-market Wrap recording here: http://www.anymeeting.com/nrodpywxnayx/E952DF83894C31

Monitor overnight Globex trading in the chaRTroom here.

TUE morning signal (triggered at 10:15 ET) SPX ES Bias-up: above  2019.25 2010.00 ...would target  2024.75  2015.50 Bias-down: under  2008.25  1999.00 ...would target 2002.75  1993.50 Signal status: NO-BIAS, TESTED BIAS-UP 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.