Trading Plan for 2/22

Is that an expiration in your pocket, or…  A last-minute surge expended a lot of energy just to return back to the morning’s failed high – which was touched only after the cash session close. Seems pretty optimistic ahead of a three-day weekend. [pay]

Pattern points… (Setups and technicals)
Friday morning’s late trending, and the last-minute surge, were products of expiration. Trending after no-bias is signaled is unusual. Trending sharply into the close isn’t unusual for expiration. The 1341.50 cash session closing equivalent was exceeded several minutes later to 1343.00.

Friday’s last-minute surge was a replay of the morning’s slower, but similar move. Each originated from the same area, and each gained 6 points. The late surge’s momentum might make it seem more durable. It’s actually more difficult to extend. Both RSIs went overbought, and that makes the trending vulnerable to a reversal.

Also, Friday afternoon is lightly attended. Any trending that originates then only reflects weak hands. That, or in this case, expiration.

Monday mornings often duplicate characteristics of expiration afternoons. On three-day weekends, the mimicry tends to be Sunday night. Either way, it’s irrelevant. I point this out only to make clear that Tuesday’s price action won’t be very tied to Friday’s.

What’s Next… (Outlook and opportunities)
Except for Friday’s high(s), 1338.75 contained all of the intraday timing windows. The last-minute surge originated there. An attraction back down to it could slingshot price down sharply to 1333.00. A gap down would have to break 1333.00 to avoid bouncing sharply. Otherwise, the next higher objective is 1348.75. [/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.