Stock Market Trade Signals from Viditrade - 02-23-2017

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

NEW DAILY SCHEDULE First, watch the pre-open Tour recording HERE <<== Then, meet in the chaRTroom here by 9:15 ET for updates and Q&A

Through the prior close... Sliding overnight into Wednesday's open had threatened to break under Tuesday afternoon's 2357.50 lows. Its test held, and so did the morning's 2356.75 bias-down signal, putting into play an offsetting test of the 2366.00 bias-up signal. The morning's rally stopped ticks short of overnight highs at 2363.25. The balance of the session ranged choppily sideways. Choppily, as in absorbing a 6-point plunge in reaction to the afternoon's FOMC Minutes release, which might have derailed an attempt to resume the morning's recovery. The outstanding 2366.00 became "unfinished business above.". Overnight action's new info... Of the possible scenarios I described yesterday for actual action overnight, none of them played out. Not that action developed in any other way. Instead, nothing has actually happened, at all. At least, not until very recently. An ongoing 1-point wide range greeted Europe's opens, where firming has extended to pierce yesterday morning's high up to Tuesday night's 2363.75 high. If, then... Although none has played out, the possible scenarios for overnight action are still viable. The likeliest path remains testing 2366.00, and then reversing down from its test. Econ reports and Fed speakers scheduled before the open are capable catalysts for triggering a gap down -- no less capable than was yesterday afternoon's FOMC Minutes, whose steep immediate impact makes it all the more a failure for its complete retracement. So, unless the open is gapping down under yesterday's lows, I'll be reluctant to short prior to probing fresh highs. First Trade... [Click here to view the Bias parameters] Exiting the open at 9:45 above 2364.75 would be likely to trigger the 2362.75 bias-up signal at 10:15. Exiting the open under 2358.50 would be unlikely to trigger bias-up.

Vulnerability at upside target proves out. Touching this morning's 2367.50 bias-up target pre-open triggered a reaction down. Its resistance was still influential, regardless of not yet having been put into play at 10:15 by recovering the 2362.75 bias-up signal. In fact, it wasn't put into play. No-bias has triggered. The reaction down consolidated at 2362.75, but it was broken at 10:15 on the way down to 2358.50. Holding a test of the bias-up signal has put into play an offsetting test of the 2354.25 bias-down signal. A test of the 2348.25 bias-down target isn't officially in-play, since the 2367.50 bias-up target wasn't touched post-open. But having touched it only 3 minutes prior to the open does warrant monitoring for its offsetting test, too. Meanwhile, "unfinished business above" at 2366.00 was neutralized. The opening print is a couple of ticks higher and has yet to be filled --  but the first minute's bar was retested from below, so I'm dismissing that possible upside attraction as too trivial to prevent extending down more substantially today.

THU afternoon signal (triggered at 1:20 ET) SPX ES Bias-up: above  2363.75 2362.00 ...would target  2369.50  2367.75 Bias-down: under  2355.25  2353.50 ...would target  2350.00  2348.25 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.

Another sell-off absorbed? Holding a test of the 2362.75 bias-up signal had put into play an offsetting test of the 2354.25 bias-down signal. Fulfilling it had no particular timing, and could have taken longer than yesterday's morning's 2366.00 objective that was met pre-open. But a dive to 2353.00 fulfilled the objective during this morning's bias environment, and held it. It was only overlapped, and its RSIs made higher lows or diverged positively, so no lower objective was put into play. Testing this morning's 2348.25 bias-down target was only potential, and still is. Now a bounce has tested this afternoon's 2362.00 bias-up signal to 2363.50. The signal held, triggering another no-bias. A drift or drop could test the 2353.50 bias down signal, and lower after the bias environment lapses. Not yet resuming the decline coming out of the bias environment would be likelier to retest today's high. Another attempt to sell-off wouldn't have as much potential for holding and recovering.

Thursday's "outside day" encompassed all of Wednesday's range, and all but Tuesday's first-minute gap up. That gap up had surged through the open. But Thursday's gap up quickly reversed back into the range, and through it, for a 14-point drop. So, add that to the list? Thursday's 14-point post-open drop puts the rest of the list to shame --Tuesday's 9-point drop from its morning high and 7-point drop through its close, and Wednesday's 6-point drop after FOMC Minutes. That's a lot of big, isolated drops within a 9-10 point range, during a brief 3-day window. Something all of the drops have in common is their retracements. Thursday's drop was retraced to within 2 points of its post-open origin. That's larger than any of the prior drops. Their shallower recoveries each soon failed, so Thursday's incomplete recovery suggests that optimism is healthily restrained. And that's potentially bullish from a contrarian perspective. Thursday's late dip wasn't productive early enough to be predictive of further selling pressure. It may have only stretched the rubber band to snap back up Friday. Regardless, the burden of proof is on sellers either to gap down substantially Friday or trigger bias-down to avoid probing higher highs. Details and other markets coverage are discussed in the post-market Wrap recording here.

Monitor overnight Globex trading in the chaRTroom here.

FRI morning signal (triggered at 10:15 ET) SPX ES Bias-up: above 2367.75 2366.00 ...would target  2374.00  2372.25 Bias-down: under  2358.75 2357.00 ...would target  2354.00  2352.25 Signal status: BIAS-DOWN, BIAS-DOWN TARGET MET 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.