Trading Plan for 12/2

If there is no unfinished business above… then must Friday’s late plunge extend down? No, but Friday’s highs need never be touched again. Friday abbreviated session was incapable of being predictive, so avoiding the late plunge wouldn’t have been bullish. Monday’s session has an opportunity to define the next significant trending.

Pattern points… (Setups and technicals)[pay]
Two “new Globex trend extremes” were neutralized Friday. More important than neutralizing the oldest one — last Sunday night’s 1809.25 extreme — was neutralizing Thursday morning’s 1810.00 fresh higher high. Similarly, Friday’s morning’s 1812.00 bias-up target was neutralized just minutes after being put into play.

The market is getting faster at neutralizing upside attractions. And it didn’t leave any new ones outstanding to maintain the rally’s momentum

Neutralizing a fresh upside attraction doesn’t allow it to attract more sponsorship that might defend its reaction down.  And Friday did react down. Any credible reversal down had to be aggressive, and no longer being aggressive would mean the reversal down had ended. Friday’s plunge under the 1810.00 sell signal lasted 15 minutes from 3:37-3:52, which is the same pre-close timing as the daily position-squaring window.

Friday’s late plunge might not have been predictive. But it reversed earlier gains that were less relevant.

Chipping away all week at 1806.50 resistance had earned at least an obligatory probe higher. Closing back under 1806.50 on a normal day would have suggested the probe had gained no traction for its effort. Closing back under its 1798.50 interim low would have signaled momentum reversing down. Resuming the rally Monday would mean Friday’s sellers were irrelevant.

[/pay]What’s Next… (Outlook and opportunities)[pay]
There is NO Saturday Strategy Session, this being a holiday weekend. But don’t hesitate to request any chart analysis as needed. [/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.