Trading Plan for 12/22

If not for expiration… then Thursday”s last-hour surge probably wouldn”t have happened. Having happened, and having extended higher, expiration probably muted the late reaction down.

Pattern points… (Setups and technicals)
Wednesday”s Expiration indicator (WedEX) triggered  bullish. That was primarily due to Wednesday”s session not extending the recent downtrend. Unless inverted, Friday afternoon and Monday morning were destined to be biased upward.

Actually triggering bias-up Friday morning prevented WedEX from inverting, although the balance of the morning only ranged sideways after testing the 2065.25 bias-up target. The afternoon did trend higher — the bias environment was exited above the noon hour”s high and the final hour was entered higher. 

Extending up to a new high at 2076.25 peaked into the position-squaring window and reversed down sharply to 2065.25. Post-close action has extended down to within 1 tick of the reversal”s 2062.75 target, at uptrending support that formed during the noon hour.

Now the bullish WedEX can resume its influence Monday morning. CAVEAT: There is no assurance the opening tick won”t gap down significantly, but post-open action should trend up into the noon hour.

What”s Next… (Outlook and opportunities)
New highs were probed so quickly from the recent low. New sponsorship never built integrity that can be relied upon to defend a reaction down after Monday morning. And that assumes Monday morning bounces from the open, which could entice even more sellers. But this being a holiday-abbreviated week, with an early close Wednesday, not reversing down Monday could avoid reversing down through Christmas.