Trading Plan for 11/15

If expiration were to produce a new trend high close… then the next downturn might not be possible until midweek. Expirations are unlikely to contain a trend extreme, as are Fridays.

Pattern points… (Setups and technicals)[pay]
Buyers gained no traction for their efforts Thursday. That seems odd to say when S&Ps closed 9 points higher, trading almost exclusively in positive territory. But that was produced entirely through the morning’s bias environment. The afternoon… not so much.

Also, Thursday’s new high close was not an arbitrary level, but at the afternoon’s 1787.75 bias-up signal. Resistance was touched, and held — not broken. Also, after the bias environment lapsed, Thursday’s last 90 minutes ranged narrowly around 1787.75. There was plenty of time to extend higher, had that been the market’s intention.

None of which is a sell signal. Friday’s expiration is a wild card, regardless of whether the rally from Friday’s low has been expiration’s influence all along. The late breakout that triggered the WedEX setup still leaves the possibility that expiration’s influence was already fulfilled.

[/pay]What’s Next… (Outlook and opportunities)[pay]
No matter how much buying pressure has been expended, just entering expiration at a new closing high still carries significant upside risk. Trending throughout expiration’s opening 15 minutes of volatility tends to extend in that direction through the day. And this being a Friday, the morning’s bias is likely to persist through the noon hour. So, not rejecting the rally immediately Friday might not be able to reject it until midweek.[/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.