Real Time Stock Market Trade Signals - 08-21-2015

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...
Gapping down and trending down Thursday somewhat duplicated Wednesday morning''s pattern. But where Wednesday bounced into the afternoon, Thursday morning''s decline extended. And extended. And extended. A last-minute plunge essentially doubled the entire post-open drop that had preceded it. The cash session close fulfilled the 2035.00 objective that was targeted by a break under 2077.00, on the way down to 2025.50. And the gap down served by proxy to clearly define a bearish WedEX signal.

Overnight action''s new info...
Firming up to 2029.00 suddenly gave way to another plunge testing 2015.00, which soon extended down to test 2009.00 before midnight. Bouncing recovered to within 1 tick of 2029.00, but that reacted back down to 2018.00.

If, then...
If the open isn''t already recovering above the 2035.00 area, then the overnight recovery attempt will have likely failed. The consequence could fall far below the overnight low -- not necessarily easy, but easier. This may seem counter-intuitive since the overnight low is much deeper. But the overnight drop has cleared a path that enables lower lows. And don''t underestimate how much stronger a trending effort can be when it bites down with expiration''s teeth. Meanwhile, this being expiration, trending through the opening 15 minutes tends to define the balance of the session. And this being a Friday, the morning''s bias tends to persist through the noon hour anyway.

First Trade...
Exiting the open at 9:45 under 2020.75 would be likely to trigger the 2023.75 bias-down signal at 10:15. Exiting the open above 2027.75 would be unlikely to trigger bias-down. Exiting the open under 2016.50 would be likely also to exceed the 2019.75 bias-down target at 10:15 to renew the bias-down signal.

Pre-open clears away more of the path down.

After the overnight drop to 2008.75 had been recovered -- at least probing above yesterday''s futures close to attack 2029.00 -- I noted in the First Trade blog post the risk of fresh lows, despite that seeming counter-intuitive. While anything can happen during expiration, it already had. The overnight drop had started clearing a path down.

A last-minute plunge before the open did probe a fresh low down to 2007.50. That reacted up 10 points to test 2017.00 before 9:45. That was retraced back down to 2009.00 in time to prevent the opening 15 minutes of volatility from trending -- just as we discussed during the pre-market Tour, since that would have conflicted with the bearish WedEX.

Those swings formed a Symmetrical Triangle that launched a bigger upleg to its 2022.00 target. Symmetrical Triangles tend initially to break falsely in one direction and then to reverse more substantially in the opposite direction. So, having fulfilled buying pressure, the decline was free to resume.

Which it did by tumbling to new lows at 2003.00. As pointed out during yesterday''s post-market Tour and this morning''s pre-market Wrap, that represents "lower prior highs," and the last opportunity for a bounce before basically falling off the cliff.

So far, that bounce is testing 2008.00. It hasn''t even touched the overnight low, and it has barely touched the post-open low. That''s not much of a bounce. The decline is free to resume,.. and look out below if it does.

FRI afternoon signal (triggered at 1:20 ET) SPX ES Bias-up: above 2013.75
2010.00
...would target 2020.25
2016.75
Bias-down: under 2001.25
1997.75
...would target 1995.50
1991.75
Signal status: waiting for trigger 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 Sep Contract (EC, ETF: (FXE, UUP))
Gapping up Thursday no the way to fulfilling 1.1220 without closing above it didn''t prevent extending higher overnight and gapping up Friday to test the next higher objective at 1.1360-1.1385 intraday. .

Gold Dec Contract (GC, ETF: (GLD))
Extending higher Thursday night attacked the next higher target at 1169.00 to within almost $1. Intraday highs held 1158.00 resistance.

Silver Sep Contract (SI, ETF: (SLV))
The underperformance vs. Gold became more obvious Friday as an overnight probe above last week''s highs was reversed back down into negative territory for the duration of the session. Back above 15.45 would start to signal that Silver intended to play "catch-up."

30-year Treasury Sep Contract (US, ETF: (TLT))
Overnight highs retested 160-20 but dipped back into negative territory during Friday''s open. That was recovered into Friday afternoon in a flight-to-quality. The second consecutive higher close above a multi-session range now requires there to be a third higher close, albeit not necessarily consecutively on Monday.

Crude Oil Oct Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
The decline extended, still not at any new pace other than to have begun sliding from its recent multi-range consolidation. While Wednesday''s confirmed breakout is now fulfilled by a minimum third lower close, the energy market doesn''t tend to end trends on Fridays. So, at least a lower intraday low is likely, and meanwhile the potential to 37.55 remains intact.

Natural Gas Aug Contract (NG, ETF: (UNG, UNL))
The confirmed breakout''s third lower close was finally produced Friday. But a lower low is likely since this market doesn''t tend to bottom on Fridays.

MON morning signal (triggered at 10:15 ET) SPX ES Bias-up: above 1986.00
1982.50
...would target 1992.50
1989.00
Bias-down: under 1968.00
1964.50
...would target 1962.00
1958.50
Signal status: BIAS-DOWN, BIAS-DOWN TARGET EXCEEDED 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.