Stock Market Trading Signals - 04-27-2015

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

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Through the prior close...
Friday''s noon hour pierced Thursday''s high by a single tick, touching the afternoon''s 2114.75 bias-up signal as resistance. Otherwise, it was an inside day, contained entirely within Thursday''s range. Actually, within Thursday afternoon''s range, optimistically avoiding a dip back under the prior highs that Thursday morning''s surge exceeded. That was a breakout, and Friday''s inside day didn''t confirm it, despite being a new trend high close.. The entire session ranged in positive territory without extending higher, which is "ineffectual optimism."

Overnight action''s new info...
Narrow ranging 1 point either way around 2112.75 suddenly surged to 2116.50 into Europe''s opens, presumably on expectation of China doing a round of QE. Europe''s concerns over Grexit immediately drove price down sharply to 2108.50. A relentless retracement recovered it all to now retest the initial high up to 2118.00.

If, then...
Friday''s complacency after Thursday''s breakout was a sign of things to come, but not necessarily a sell signal. The condition tells us to monitor for the next probe of fresh highs. Having reserved its energy Friday, will Monday compensate for the delay with a new breakout close, or will an intraday probe of fresh highs only stretch the rubber band to be reversed and to close negative. Either resolution could extend into Wednesday morning ahead of that afternoon''s FOMC policy statement.

First Trade...
Exiting the open at 9:45 above 2115.50 would be likely also to trigger the 2113.75 bias-up signal 30 minutes later at 10:15. Exiting the open under 2110.00 would be unlikely to trigger bias-up.

Chipping away at the bias-up target''s resistance?

The pre-open recovery extended to within 3 ticks of the 2119.75 bias-up target, within 5 minutes of the open. Its attraction would be considered neutralized if not fulfilled this morning, regardless of being put into play.

And almost avoided being put into play. The open''s reaction down slid immediately to touch the 2113.75 bias-up signal as support. 

A 2-1/2 point bounce was retraced entirely, while 1-minute RSI diverged positively. Bias-up triggered at the 10:15 bias timing window, that wasn''t an issue. But the bias-up target had been touched at the high.

So, this is a bias-up environment, whose target has been met.

Usually this setup avoids extending higher this morning. That opens the door to reversing down, which is a risk this afternoon if the market were to become paralyzed by anxiousness ahead of AAPL''s post-close earnings.

But the rally''s momentum remains intact above the 2117.00 area. Holding it as support would allow the rally to extend. Otherwise, at least backing-and-filling down to the 2114.00 area becomes likely, and vulnerable to reversing into negative territory.

MON afternoon signal (triggered at 1:20 ET) SPX ES Bias-up: above 2121.75
2115.50
...would target 2126.75
2120.75
Bias-down: under 2116.00
2110.00
...would target 2110.50
2104.25
Signal status: BIAS-DOWNT 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 Mar Contract (EC, ETF: (FXE, UUP))
Higher highs Monday kept alive potential for extending the bounce to attack 1.1100, so long as 1.0845-1.0855 holds as support.

Gold Jun Contract (GC, ETF: (GLD))
Friday''s test of the 1170.00-1174.00 target to within a dime proved enough for a bounce Sunday night that retraced 61.8{faed0d6dca04cec8b6b7985efddb9b0651107a3aebb05f69f0166038b8c951f6} of the drop from Thursday''s high. But that was nothing. Monday''s opening gap up consolidated briefly around 1185.00, and then surged sharply to eventually probe attack 1207.00. That''s hardly a stable base to launch a recovery, so at least a dip back to 1194.50 is likely.

Silver May Contract (SI, ETF: (SLV))
The 4-day sequence of unconfirmed breakouts was followed by Monday''s gap up to 15.85 that extended sharply higher post-open to 16.45. That''s the lower-end of resistance up to 16.60, which will be difficult to recover without first testing 16.10 as support.

30-year Treasury Jun Contract (US, ETF: (TLT))
Friday''s 61.8{faed0d6dca04cec8b6b7985efddb9b0651107a3aebb05f69f0166038b8c951f6} retracement of the last downleg proved enough for renewed dipping Monday to test 162-00 support. But no lower, as its test at Monay''s open was recovered to within 10 ticks of the 163-18 bounce limit.

Crude Oil Jun Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Narrow sideways ranging neither pierced the 57.70 (not 56.70) buy signal. It would not be able to tolerate any hesitation the following day, so its break had better be sure about itself. The buy signal''s potential remains alive so long as the 56.58 (not 55.58) pullback limit continues holding as support -- which it did, throughout Monday''s lows.

Natural Gas Jun Contract (NG, ETF: (UNG, UNL))
Gapping down into the front-month roll (from May to Jun) doesn''t allow a buy signal to form, let alone to trigger, before another session retests Monday''s 2.49 opening print. But doing so after closing above 2.51 could find a very quick upleg underway to 2.73, 2.80 and 2.90.

TUE morning signal (triggered at 10:15 ET) SPX ES Bias-up: above 2117.25
2111.00
...would target 2122.75
2116.75
Bias-down: under 2106.25
2100.25
...would target 2101.50
2095.25
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.