Realtime Day Trading Trends and Signals - 12-11-2015

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... Thursday's opening bounce was retraced entirely, as deeply and as late as possible without reversing the trend down under 2036.00. It was rewarded with a rally to test 2054.00. That bounce was retraced almost entirely, also as deeply and as late as possible without reversing the trend down under 2040.00. Its reward was a rally to test 2058.00. Coincidental to campus shooting headline, a pullback limit's violation resulted in sliding back down to the noon hour's 2040.00 low through the close. Overnight action's new info... Instead of extending, the late plunge was retraced 38.2{faed0d6dca04cec8b6b7985efddb9b0651107a3aebb05f69f0166038b8c951f6} to attack 2048.00. Ranging gingerly flat-to-lower tried bouncing at Europe's opens, but there were no more rewards -- only consequences. The first reaction down probed fresh lows attacking 2036.00. Its bounce resolved down sharply lower to 2024.00. If, then... Trending down post-open on Fridays can get out of hand with two days of illiquidity fast-approaching. Gapping down significantly can over-compensate, and reverse back up immediately. But that window of opportunity is brief. Retesting Tuesday's ~2027.00 low was likely eventually. Its retest is likely to include 2022.00, which is now being attacked. Recovering both of their tests through the open would be the most reliable recovery setup -- yet still vulnerable to resuming the decline. First Trade... Exiting the open at 9:45 under 2027.25 would be likely also not to recover the 2033.00 bias-down target by 10:15, renewing the bias-down signal. Exiting the open above 2036.50 would be unlikely to renew the bias-down signal.

Here are the correct links to today's chaRTroom:

CHARTROOM LINK(s) o Win XP-Friendly entry o non-xp friendly (ilinc) (pre-open Market Tour begins at 8:55 ET)

Big gap down stays down. The pre-open slide to 2012.25 reacted up into and out of the open to 2022.00. Just 3 ticks higher would have signaled the overnight decline was being reversed back up. Instead, a reaction down ultimately extended to fresh lows at 2011.25. That also reacted up to touch 2022.50. Ranging there lasted too long to be considered as rejecting the decline. One last gasp up to 2025.50 has been reversed down to 2012.25. Its next lower attraction is to retest the low. But the pattern's purpose is to resume the overnight decline. This has been a quite an open. The overnight slide is essentially validated by having delayed its rejection. As I discussed pre-open, Fridays have greater vulnerability to trapping an overnight move. But that window had to be exploited early, or else not at all. Having dropped so much so quickly, already expending a lot of selling pressure, the slope need not steepen into new lows. But it should behave in a relentless way on the way down to 2009.50 and 2003.00.

FRI afternoon signal (triggered at 1:20 ET) SPX ES Bias-up: above  2031.50 2022.00 ...would target  2036.75  2027.25 Bias-down: under  2019.00  2009.50 ...would target 2012.50  2003.00 Signal status: LATE BIAS-DOWN 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.

Bouncing out of the noon hour. The post-open ranging had expended a lot of energy up to 2022.00.  It succeeded in preventing the overnight decline from following-through under 2012.00. A surge tested 2025.00, too late to have a bullish impact. Instead, it stretched the rubber band, which snapped back down to 2003.75 at the noon hour's low. Coming within 3 ticks of the 2003.00 bias-down target no longer requires its test. It would not become "unfinished business below" if left outstanding. If it is signaled. Actually, it did barely. The 2009.50 bias-down signal WAs being overlapped within 3 minutes of the 1:20 bias timing window to invoke the grace period . It wasn't recovered through 1:30, so this is a late bias-down environment. The trek to fresh lows remains intact. Nothing prevents trending under the 2003.00 target. Exiting the bias environment under it could prevent recovering.  

MON morning signal (triggered at 10:15 ET) SPX ES Bias-up: above  2019.00 2009.50 ...would target  2024.75  2015.25 Bias-down: under  2005.00  1995.50 ...would target 1999.75  1990.25 Signal status: LATE BIAS-DOWN. TESTED BIAS-UP SIGNALS 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.

A new low close into the weekend is not impossible to recover from. But not immediately. Not durably. Not without doing more damage to the chart first. A bottom here would be considerable as unlikely as that seems. Meanwhile, the downleg seems vulnerable to extending since current news is so scary. Ever the contrarian. Details and other markets coverage are discussed in the post-market Wrap recording here: https://roddavid10.mitel-nhwc.com/join/cxsrpjb

I'll send links overnight to the Saturday Review.