Trading Plan for 3/12

[pay]Pattern notes.
Wednesday’s ranging ultimately closed too low for the session to be considered an extension of Tuesday’s rally. The open was higher, but it was absorbed by a reversal into negative territory. An afternoon surge nearly reinstated the session’s more bullish qualities, but the closing action dipped too far.

That’s not to say Wednesday’s gain had no bullish qualities. It did trade mostly positive, and chipped away at resistance throughout. But in so doing, the pattern fulfilled all minimum targets of any lower accumulation patterns. Rather than extend through the targets the market reacted down, and failed to form new accumulation patterns with higher targets.

Overnight action slid further to help reveal Wednesday’s lack of contribution to the rally’s effort. A couple of early-morning surges are threatening to recover back above Wednesday’s critical 714’00-715’00 lows (717’00-718’00 basis Mar). If not successful, all of Thursday’s session could range under Wednesday’s lows, back inside Tuesday’s range, undermining the efficacy of Tuesday’s gains. The the rally’s effort could be salvaged by closing above the 705’00 area today (preferably after probing it intraday) to attract more buyers comfortable at the relatively shallow pullback.

Indicators and Internals.
The Jun contract replaces Mar as front-month beginning with the cash session’s opening tick at 9:30 ET. No business was left unfinished from prior trading – some was created overnight, but already neutralized.

Thursday’s opportunities.
This morning’s econ reports generated an initially favorable reaction, a surge that furthered the improvement above 714’00-715’00. Maintaining the gain could avoid any cash session trading in Tuesday’s range, which would then require a close above Wednesday’s high to avoid being considered distribution.[/pay]