Trading Plan for 11/28
[pay]Pattern notes.
Wednesday’s energizer rally didn’t bleed immediately into Thursday’s Globex-only session. But it did help to recover from a 10-point pullback from Wednesday’s close around 886’00. And it has helped Thursday night’s trading to probe even higher up to 893’50. Yet 886’00 keeps attracting price back to it.
Underlying it all is Wednesday’s close above 880’00 instead of under it, which made higher highs possible. A second consecutive higher close today would help to confirm that momentum remains intact, next targeting 911’00. But a negative close would undermine Wednesday’s signal, and all that the higher high was built on.
The probes have been too narrow to be “new Globex trend extremes” that require a retest intraday. Probes beyond the prior session’s high do tend to be retested, which is not the same as being required. The tendency remains likely unless a prior low is broken first. I would caution that these tendencies could be entirely moot on half-days, during a holiday weekend – the data for comparing similar setups simply doesn’t exist in the size necessary to earn confidence.
All that having been said, the most recent higher high at 893’50 is 90 minutes old and backing down again, currently touching 881’50. That’s 2 ticks above Thursday night’s low, whose break would undermine the tendency to retest the high. That might be the only way sellers can work their way back in to a market they drove lower Tuesday night before it left them beside the road Wednesday morning. Otherwise the attraction back up to overnight highs could resume the rally.
Indicators and Internals.
MACD & RSI diverged negatively into higher and higher highs until sellers finally caught. So far only 1-minute indicators are trying to do the opposite at 881’50, but not yet 3-minute. A bounce is possible here, but probably not yet able to last.
Friday’s opportunities.
Early weakness could catch-on with the same mentality that buyers found Wednesday. But unless 879’00-881’00 is broken as support through a relevant timing window – of which there is only one today (the session closes at 1:00pm) – the balance of the day would more likely range flat to higher.[/pay]