Trading Plan for 11/8

If another surge were to probe another new high… then would sellers finally let buyers have their way? Fridays can get carried away, and a lot of selling pressure has been expended. But another surge isn’t very likely, or at least isn’t very likely to probe another new high.

Pattern points… (Setups and technicals)[pay]
Thursday’s swing was not arbitrary. The pre-open surge peaked precisely at the 1774.50 level we have been discussing for the past week. The potential for a substantial intraday decline was described before the first hour ended. The noon hour contained the expected temporary bounce. And the drop’s lows fulfilled the next lower target at 1742.50-1743.25.

I wonder whether it also wasn’t arbitrary for the drop to close under prior lows Thursday. The same session printed a new extreme for the trend. That precludes the session from also signaling that the trend is reversing down. Not that Friday is precluded from being a horrible ugly downday — it just can’t be signaled. Especially not when the prior session fulfilled selling pressure at its low.

Even in the case of an initially favorable knee-jerk reaction up after the Employment Situation report, a bigger sell-off into the weekend remains possible, if not also likely. But back above 1756.00-1757.00 could still rob sellers of a lot of traction.

[/pay]What’s Next… (Outlook and opportunities)[pay]
I will be in front of the market all morning Friday for the Employment Situation report. I will not be back during the afternoon (the Chartroom will remain open). Next week is all Kansas City, all the time.[/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.