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

DAILY SCHEDULE Watch the pre-open Tour recording* HERE <<== *Manually open Adobe Connect (install on Windows or Mac), then paste the recording's link there. chaRTroom is now open... Pre-open update is at 9:15 ET

Through the prior close... (summary of last Market Wrap) Coronavirus vaccine news had triggered Monday night's bounce from 3214.00 to 3259.50, which was retraced entirely into negative territory at 3220.00. A second bounce to 3246.00 retraced 61.8{faed0d6dca04cec8b6b7985efddb9b0651107a3aebb05f69f0166038b8c951f6} back to overnight highs, and was retraced entirely into negative territory through Tuesday's opening 15 minutes of volatility. Then things got ugly for the first time when the morning bias environment slid to 3176.00. Its reaction greeted the noon hour at 3198.00 where things got ugly for the second time. The afternoon bias environment slid to 3121.50, where the balance of the session fluctuated choppily sideways around the decline's 3135.00 target between 3157.50-3117.25. Tuesday finally closed at 3128.00-3133.50, up 10-15 points from being down 109 at its low. Overnight action's new info... (nearby chart is last intraday session and Globex) Firming through the close had extended up to 3144.50. Further firming eventually probed the afternoon's 3157.50 high by 1 point before midnight. Flat-to-lower ranging turned down at Europe's opens, similar to the prior night. This was more of a collapse -- 61 points in an hour, probing new lows down to 3091.00. Remember way back when the next lower target at 3291.00 was met Sunday night? Fun times. Apparently that was a little too quick for the market, too. Its reaction has now recovered to 3144.50. If, then... (notes to accompany the Tour recording) Three features I described yesterday about this morning, with one update: 1) The pattern's next intraday stage should be steeper than its previous stage, whether a short-squeeze up or capitulating down. 2) That next steep stage is likely to begin immediately, gapping open sharply higher or lower and extending that direction. 3) The morning's steep intraday move becomes vulnerable to a "Wreversal Wednesday" that ends the day exactly opposite from its start, and not wreversing would be vulnerable to extending the morning trend, especially if it were down. Now the update: Last night's collapse fits the Wreversal Wednesday template of trending sharply and then reversing substantially. The question is whether that WAS the wreversal, or a glimpse of what's coming. If the former, then maintaining its wrecovery through the open can complete a bullish Isolation setup that trends up this afternoon. But now having formed the Isolation setup's basis, NOT completing it can be as bearish as it would have been bullish. First Trade... (preliminary indications for the Bias parameters) Exiting the open at 9:45 above 3143.00 would be likely to trigger the 3141.00 bias-up signal at 10:15. Exiting the open under 3133.00 would be unlikely to trigger bias-up. Exiting the open above 3133.00 would be unlikely to trigger the 3125.50 bias-down signal. Exiting the open under 3120.75 would be likely to trigger bias-down.

Up, it is. The one caveat, literally, is Wreversal Wednesday. It looks like last night's pattern, convincingly trending in one direction, then reversing to end the window exactly opposite. Last night's reversal led to this morning's bullish Isolation setup. Probing yesterday's 3120.00-3117.00 lows, was recovered enough to spend the entire opening 15 minutes of volatility in positive territory above 3128.00. 3128.00 wasn't even touched. The 3142.25 open barely dipped before surging to 3175.25 at its the highest calculable resistance. This created a lot of room for a pullback, which fell to 3147.25 -- 2 points lower than the leg's target. The entire pullback is now recovered to fresh highs attacking 3178.00, with no particular requirement for the balance of the morning.

Meanwhile, the Isolation setup's reward is to retrace the origin of the isolated probe's downleg. Due to its gap, that is Monday's 3233.00 open, probably also Monday morning's 3260.00 high. Or higher, like the 3295.00 gap-to-gap retracement.

About that caveat. Any more upside depends on maintaining the Isolation setup. And we know that mentality is stalking today's session. Not only for this being Wednesday, but more so for the overnight ALREADY producing a Wreversal Wednesday setup. Sellers are not marginalized, and the recovery attempt is not entrenched.

WED afternoon signal (triggered at 1:20 ET) SPX ES Bias-up: above 3163.00 3162.00 ...would target 3171.75 3170.75 Bias-down: under 3148.25 3147.50 ...would target 3139.75 3139.00 Signal status: BIAS-DOWN, BIAS-DOWN TARGET MET . BIAS VIDEOS... INTRO // EXAMPLE 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.

Wreversal Wednesday no longer just lurking. The open's surge had retraced from 3175.00 down to 3147.00, and recovered entirely to 3182.00. All of which was reversed back through the 3142.50 open down to yesterday's 3127.50 cash session close. Aside from the incredibly-sized legs, just retracing and reversing two separate rallies makes today's recovery suspicious. Now add this afternoon's bias-down, and only one other element would paint a more bearish picture: probing yesterday's 3117.00-3120.00 lows. As I speak (write), fresh lows are testing 3108.00. The open's Isolation setup had completed by maintaining positive territory through the open. Its confirmation required maintaining yesterday's range through the close. That's now invalidated, suggesting that Wreversal Wednesday is in control. An otherwise convincing trend has suddenly become something altogether opposite. The Wreversal setup's minimum structural requirement is to retest the 3091.00 overnight low. Interim support at 3108.00-3111.00 is now being tested, and influencing at least a little bounce. Oversold RSIs will require the low's eventual retest. There is no requirement for 3091.00 to hold if tested.

Four consecutive sessions of aggressive selling had left Tuesday with a Wreversally Wednesdayish feel. Mostly an intraday behavior, the 30-point overnight rally to 3158.50 had collapsed under Tuesday's 3117.00-3121.00 lows to 3091.00. If that's the Wreversal Wednesday spirit, then its embodiment was the 3142.50 open. The overnight recovery formed a bullish Isolation setup that completed by holding positive territory through Wednesday's open. Which was exploited immediately by surging to 3175.00. An extremely choppy bias environment got to 3182.00. All the while Wreversal Wednesday continued lurking, and it took control into the noon hour at 3175.50. The afternoon low touched 3107.50. Probing under Tuesday's 3117.00-3121.00 lows invalidated the Isolation setup. The Isolation setup could have been reinstated by first closing Wednesday above a relevant level, but closing under Tuesday's lows makes a retest of Tuesday night's 3091.00 low is likely, if not also probing it by 20 points. I've seen several studies suggesting that recent price action (brief draw-down) and/or internals (advance:declines) is all but assured of A) producing a sizeable near-term bounce, B) being nearer to the decline's end, C) having resumed the rally X months later. These studies don't filter the instances of this price action or internals so near the rally's extreme. A bigger and more protracted bounce than the 90-point Tuesday night low to Wednesday morning high is possible. But it's too soon to consider any sizeable bounce to be resuming the rally from this damaged chart. See details and other markets coverage in the post-market Wrap recording* here. *Manually open Adobe Connect (install on Windows or Mac), then paste the recording's link there. Monitor overnight Globex trading in the chaRTroom here.

THU morning signal (triggered at 10:15 ET) SPX ES Bias-up: above 3121.75 3121.00 ...would target 3129.25 3128.50 Bias-down: under 3105.00 3104.50 ...would target 3194.50 3194.00 Signal status: BIAS-DOWN, BIAS-DOWN TARGET EXCEEDED . BIAS VIDEOS... INTRO // EXAMPLE 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.