Trading Plan for 4/10

If everyone imagines hearing a tree falling in the forest… then did it really fall? The “customary” 3:30pm buying spree didn’t happen Tuesday. It’s unknown whether that was because price had already rallied substantially intraday, or because the price rise had already discounted the spree’s effects — or simply because it’s not such a custom, after all. In any case, it happened within only a couple of points from new highs.

Pattern points… (Setups and technicals)[pay]
Last Wednesday’s trend change signal has been productive, but only for one day. Tuesday’s retest of prior highs threatened the trend change signal by probing the 1568.00 prior high. Buyers didn’t gain traction for their effort, closing back under the last upleg’s same 1556.00 and 1566.25 targets. Their previous rejections resolved in a trend change, and the interim recovery has been done on low volume, so the trend change remains intact. On life support, but intact.

A close above 1568.00 would require that a new trend change be signaled by closing back under Friday’s 1533.25/1547.50 prior lows. As it is, reversing back down without a new high close — in the currently active signal — would be likely to extend down at an accelerated pace.

Retracing Monday afternoon’s no-bias trending from 1548.00/1550.50 remains unfinished business below. Tuesday morning’s dip kept the door open to that being retraced without the extra detour to new highs. We’ll keep that door open mentally Wednesday just in case, but the delay makes the retracement unlikely before Thursday.

[/pay]What’s Next… (Outlook and opportunities)[pay]
Meanwhile, Tuesday afternoon’s 2:30 bias environment exit was interesting. It trended back up to session highs at 1568.00, which marginalizes sellers for the balance of day. But that wasn’t exploited, and the entire bias environment was retraced back under its 1564.75 origin. Sellers didn’t gain traction — they were marginalized — so a fresh high Wednesday would not be surprising. But the burden of proof will be on buyers to maintain it. [/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.