Trading Plan for 10/31

If Globex trading is any indication of Wednesday’s open… then we’ll be picking up essentially where Friday afternoon’s high left off. That’s the bad news. Friday afternoon’s high led to a couple of dips back to the range’s lows. The good news is that those dips have been recovered… By the way, is the market staying open?

Pattern points… (Setups and technicals)[pay]
Monday night’s trading 1393.00 low fulfilled a retest of Thursday night’s 1394.50 low. That was a new Globex extreme, but not necessarily a new “trend” extreme since there wasn’t much complexity to its price action. So, a retest was not required.

An intraday retest would have been preferable, since there was a little bit of complexity to last night’s 1393.00 low. Regardless of any likely or required retest, no retest would be likely anytime soon if Wednesday’s open were to recover above a prior high.

That’s what makes Tuesday’s 9:15am ET Globex close a potential inflection point. The reaction up from 1393.00 came within 1 tick of Friday afternoon’s 1412.50 high. And 1412.50 has been the range’s upper-end, with support back down to 1409.00. Back under 1407.50 would start to suggest that Wednesday morning will be back on defense probing under 1397.00. I may update these levels in the pre-open First Trade blog post.

[/pay]What’s Next… (Outlook and opportunities)[pay]
The exchange has announced an intention to open “normally” Wednesday morning. This is a relief for those who are dependent upon quarter-end transactions and valuations. Everyone’s so excited, but I haven’t heard anything about Thursday, or Friday. That would be problematic for sustaining a recovery attempt. [/pay]

Look for at least one update overnight or ahead of the Morning Market Tour… My thoughts on the day’s econ calendar are linked here.