Trading Plan for 2/3

If Friday morning’s bias signal were any less bearish… then the balance of the session would have been very bullish. If the open were just a bit more bearish, then the balance of the session would have been very bearish, indeed.

Pattern points… (Setups and technicals)[pay]
Friday afternoon’s bias environment probed fresh session highs. So, closing back under the noon hour’s low meant sellers gained traction for their efforts. Actually, the noon hour’s low was still being tested at the close. A hold-short was almost triggered, but for a last-minute blip-up.

Buyers already lacked credibility simply for not trending higher during the noon hour. Trending higher later only made them less credible. Dropping back down to the noon hour lows was likely no matter when it came.

But now that Friday’s noon hour lows have been tested, the question is why the break paused. Either it was because strong-handed sellers were patiently leaving selling pressure pent-up to restart the downward momentum Monday more easily. Or, sellers are weak-handed.

Retesting Friday’s 1786.00-1788.00 highs can only be bearish bullish, unless tested in order to be rejected at a bias timing window. Just resuming Friday’s late decline should have no requirement to back-and-fill, or to otherwise delay extending down.

[/pay]What’s Next… (Outlook and opportunities)[pay]
The link to this weekend’s Saturday Strategy Session can be found in the blog’s sidebar. It starts at 9:30am ET. We’ll be discussing a very interesting bigger picture, and any stocks of interest. [/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.