Trading Plan for 11/7

If simply retesting last week’s high could complete a near-term top… then there’s not much reason to expect much of a downleg to follow. While it is certainly turbulent up here at altitude. higher highs remain likely before reversing down substantially.

Pattern points… (Setups and technicals)[pay]
My last post during Wednesday’s session (also my only post, following the pre-open First Trade) described why sellers were probably not strong handed. Despite quickly reacting down 10 points from the open’s test of the 1769.25 bias-up target, the drop was only retraced further and further through the balance of the session.

61.8% was retraced up to 1766.50 through the noon hour’s exit. Two blips-up above it were retraced back under 1766.50. That measurement often proves to be a healthy correction before resuming the decline. This is probably different because the 61.8% retracement developed over so many timing windows, and since two subsequent timing windows failed to resume the post-open decline.

So, sellers aren’t strong handed, but buyers aren’t much stronger. At least they held Wednesday’s session in positive territory throughout the day. At least they left outstanding overbought RSIs at Wednesday’s 1770.00 high to require its retest. There’s still last Wednesday’s pre-open 1773.25 “new Globex trend extreme” that requires a retest intraday. And its retest would probably include 1774.50 and 1777.75.

Having said all that, triggering bias-down Thursday would be problematic to extending any higher anytime soon. The 1769.25 high neutralized the last intraday required retest (not including the test’s newly created overbought RSIs). Triggering bias-down would target a retest of 1756,00-1757.00, and there is no bullish reason to do that again. A top still seems to be forming, but be careful trying to get the last bit of it, like I am doing in the picture above (at a vineyard in Eparnay, which was much more allowing than was Moet and Chandon).

[/pay]What’s Next… (Outlook and opportunities)[pay]
Thank you again for your indulgence this week in my absences (not just for me, but also for my traveling companions, seen nearby watching the Chiefs go 9-0 Sunday night at a Paris bar full of French “football” fanatics). It goes on. There will be no Market Tour on Thursday, but I will be back for the day before the first hour ends. I will also be available all morning Friday, which is the Employment Situation report, but not necessarily Friday afternoon. [/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.