Trading Plan for 3/27

[pay]Pattern notes.
The open’s retest of prior highs and their early afternoon probe all reflected optimism. The morning’s reaction to the open’s surge, and the afternoon’s retracement back under prior highs all qualified the optimism as being ineffectual. The last hour’s recovery was optimistic for controlling the 3:20-3:30 window, and ineffectual for not exploiting it with follow-through until another 10 minutes later. The delay limited the follow-through initially to probing new highs by only 2 ticks up to 829’50.

Thursday close was above prior sessions’ highs, but not above the sesion’s prior intraday highs despite their extensive probing. Thursday close is officially a breakout above the recent range, but of a very dubious nature. Thursday’s breakout gets a benefit of the doubt for extending higher, and for putting 844’00 into play. But it should be reminded that breakouts are most vulnerable when they are at their youngest.

Meanwhile, the session left outstanding three pieces of unfinished business at lower levels. The bias-up signal still wants to test the morning’s 804’00 bias-down signal. The bias-up signal’s conversion into being a sell signal wants to test the morning’s 796’75 bias-down target. And the session’s equilibrium wants to  reverse the morning and afternoon’s rally’s by an equal or greater measureiment to the downside.

Indicators and Internals.
RSI didn’t diverge negatively into Thursday’s last-minutenew session highs. But only because technicals weren’t overbought on the first probe. RSIs did underperform, but they simply didn’t diverge negatively.

Friday’s opportunities.
The pattern doesn’t require any pullback before extending higher, but higher highs aren’t required. This being a Friday, any initial trending is likely to persist well past the noon hour. Gapping down just a little in this environment wouldn’t necessarily be bearish, but under 821’75 and 818’00 would be likely to make up for Thursday’s lost time. Two relatively high-profile news items are due, one pre-open and the other 25 minutes after the cash session open.[/pay]