Trading Plan for 4/10

If this is a corrective bounce… then the next downleg is going to be a problem. If this isn’t a correction, then what was that downleg?

Pattern points… (Setups and technicals)[pay]
Wednesday’s session never turned negative. Not that it didn’t try, although it certainly didn’t try very hard. Two dips back to Tuesday’s “lower prior highs” and its 1845.75 cash session close never gained traction.

It’s not like the balance of the morning rallied. Not until the bias environment lapsing did buyers exploit that sellers weren’t retaking control. And then they exploited the you-know-what out of it. It’s that Tuesday’s rally shouldn’t have punished a morning rally, before the close.

The morning’s rally may yet retrace, but now it will be after sellers have become even more refueled. S&Ps  are now testing the lower-end of the 1866.75-1874.00 range where last month’s gaps up had gone to die — where the market became conditioned not to trust gaps up.

There’s no assurance of the same resolution. But everyone sure seems conditioned again to buy the dips.

[/pay]What’s Next… (Outlook and opportunities)[pay]
Pricing a large financial IPO after Wednesday’s close at the lower-end of its range (ALLY) hasn’t inhibited Globex action. Economic reports will take on a higher profile Thursday morning that they haven’t had all week. I’ll still be watching for a consequence to the market having rallied Wednesday morning instead of first dipping. [/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.