Trading Plan for 3/3

If a top is forming… then its next high should be done optimistically. Overly-optimistically. And its reaction should be sudden, steep and substantial..

Pattern points… (Setups and technicals)
Ready to roll? How about, rollover? Monday morning”s rally proved that Thu-Fri sellers had expended all available selling pressure. Monday afternoon”s rally through Thu-Fri highs proved their origin would be retested, back at last Wednesday”s high.

One question is by how much, although that”s likely to be 2121.25 or 2125.00. Higher is plausible, but not as likely. Another question is what happens then.

The topping pattern assumes the high will be retested overly-optimistically. That means gapping up Tuesday, and then extending relentlessly through last week”s 2117.75 high before correcting. Each higher and higher high would define the reversal trigger.

Regardless of how last week”s high is retested, the rally can still gain traction and extend. A new high close could be confirmed to launch a new upleg.

What”s Next… (Outlook and opportunities)
Hold-long was considered at the close, which was testing the 2110.25 buy signal”s 2115.50 minimum objective. Extending higher shouldn”t probe under 2112.00,. and preferably not even touch it.