Trading Plan for 2/11

If a corrective bounce from last week’s lows is peaking… then we won’t know it for awhile. At least, not without almost literally plunging throughout Tuesday. Otherwise, even the most bearish pattern could still probe higher before the next decline. And even the most bullish pattern could still dip before resuming the rally.

Pattern points… (Setups and technicals)[pay]
Friday afternoon’s portion of the rally was not rejected at Monday’s open. That immediately gave the rally off last week’s lows some protection against reversing down. The morning’s probe under its bias-down signal was likely to recover after fulfilling a signal’s selling pressure, which it did.

Interestingly, the morning’s dip under the bias-down signal during its no-bias environment was “no-bias trending” that should have refueled buyers. Indeed, it was recovered pierce prior highs at 1795.50.

But that’s all it did, barely pierce prior highs. While retracing the no-bias trending and probing prior highs don’t require anything more substantial, trending higher would be normal. Either buyers are anxious ahead of Tuesday’s Yellen testimony, or the recovery genuinely has a problem.

[/pay]What’s Next… (Outlook and opportunities)[pay]
The embargo on Yellen’s opening remarks will be lifted before the market’s open. That’s a fairly new practice. It used to be released simultaneously with the chairman reading the remarks at 10:00am. [/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.