Trading Plan for 12/15

[pay]Pattern notes.
Monday’s last half hour. Its afternoon bias environment lapse. The morning’s bias timing window. Each of these periods was testing Monday’s 1108.75 opening gap, within 1-2 ticks. This isn’t accumulation. It’s hardly fluctuation. It’s the same principle as Friday’s gap up and sideways range, and Thursday’s. Price can still rise, but buyers aren’t gaining traction. It is an accident waiting to happen.

Nevertheless, Sunday night’s 1113.00 high is still likely to be retested. Likelier, since sellers never gained traction intraday, not for lack of trying. Despite dumping a lot of ballast, Monday’s post-open price action hardly behaved as if a breakout were underway above 1106.50-1107.50. Closing above Sunday night’s highs would give the breakout thing another try.

Live by the gap, die by the gap… One caveat to this bounce extending higher is that it can be felled by the same trick that has kept it up. That is, maintaining a gap down under prior highs would leave no unfinished business above. Gapping down under Friday afternoon’s lows would put into play targets below. Monday’s lows can be attacked without sellers gaining traction.

Indicators and Internals.
RSIs largely stayed away from either overbought or oversold boundary Monday afternoon. The 3-minute RSI did become oversold at the afternoon’s low

Tuesday’s opportunities.
The pattern has as much potential to spike up as to gap down. A spike up would be more credible for extending higher to probe Sunday fresh highs up to 1114.75 or 1116.00. A gap down has room to 1100.00-1102.00 before reversing momentum down – probably not for a new downleg, but to attack the 1090.00 area. Trending will be difficult to start, let along sustain, until Wednesday’s FOMC announcment is in the rear view mirror instead of aiming for it at 60 mph. Tuesday’s econ calendar  offers its own incentives, starting out busy, and then adding an item after the noon hour. [/pay]