Trading Plan for 10/3

If Friday”s NFP were greeted from strength… then an initially negative knee-jerk reaction down would be retraced, and reversed back up into the weekend. But Thursday afternoon”s recovery peaked at resistance. Again. The same resistance as at Wednesday”s close. How”d that work out.

Pattern Points… (Setups and technicals)
Thursday afternoon”s complete retracement of the morning”s decline stopped short of recovering a prior high — like, Wednesday afternoon”s ~1943.50 prior high. That”s not necessarily bearish. But it could be, since the prior high was probed temporarily without closing above it. Not touching it at all would have had more bullish potential.

At least the reaction down didn”t break under prior lows. That would have confirmed the resistance test had held, and had launched a new downleg. That could still be the resolution, and just not yet in-play.

So, extending higher simply requires gapping up above the resistance that held Thursday afternoon. A lot of ground above could be covered for a lot of the session. Otherwise, opening flat or trying to recover from gapping down might probe fresh highs, but not for long.

Meanwhile, oversold RSIs at Thursday”s low must be retested at some point. Usually, sooner rather than later. Not rallying out of Friday”s open, i.e. not reacting favorably to the pre-open Employment Situation report, would more likely return to Thursday”s low.

What”s Next… (Outlook and opportunities)
Thinning participation ahead of Friday evening”s Yom Kippur services will make a normally less liquid afternoon less liquid. That makes trending underway difficult to stop, and harder to reverse. It also makes trending difficult to start, and makes prior highs and lows ultimately likelier to hold their tests.