Trading Plan for 1/8

If Thursday”s open mimics Wednesday”s gap up… then we”ll have an interesting insight into Friday”s setup for the jobs report.

Pattern points… (Setups and technicals)
Wednesday”s opening print gapped up 17 points to the 2011.50 “unfinished business above,” and reacted down. The first half-hour recovered to quickly fulfill the morning”s 2017.75 bias-up target, and reacted down. The bias environment”s exit quickly recovered the morning”s backing-and-filling by surging 17 points to begin testing the 2022.00-2023.00 target area.

And ranged sideways.

Significant price action Wednesday was essentially contained within the cusps between the three morning timing windows. The timing windows themselves were their setups. This is interesting, because all of Wednesday afternoon only ranged sideways. Was that just a big setup for Thursday?

Recovering Tuesday”s drop, back up from 1984.25 to Tuesday morning”s 2023.50 high, probably intends to probe higher. Wednesday”s “ineffectual pessimism” keeps alive that potential. Resuming the rally would next target 2029.00, then 2044.00 and 2052.00. An interim downdraft Thursday is possible, but a deep downdraft is unlikely.

What”s Next… (Outlook and opportunities)
Wednesday afternoon”s sideways ranging produced three consecutive timing windows that overlapped each other entirely. The recovery had better shake off that potential inertia before it takes root through the morning. Gapping open is not enough — trending out of the open will be needed in order to expect any decent trend intraday.