Trading Plan for 4/13

Friday the 13th?… Don’t forget about Saturday the 14th, for our weekly Strategy Session. It begins at 9:30am ET, and its link is in the blog’s sidebar.

Pattern points… (Setups and technicals)[pay]
Closing above 1380.00 Thursday would have been constructive for a bigger corrective leg. Wednesday’s rally had a similar opportunity to close above 1369.00, but failed. Clearly that didn’t prevent a bigger bounce, like Thursday’s rally to 1386.25. But it does tell us the move is still likely a correction before resuming the decline to new lows.

So, was Thursday’s close above 1380.00? Not clearly. Prior to the last touch of 1380.00 as support, the intraday high had been 1383.00. Every higher high retraced back under it, including the last surge to 1386.25. Opening Friday under 1380.00 would confirm it had held. But the open must surge from 1383.00 to even begin signaling its recovery.

Extending higher would next target filling the gap back to 1390.00. This would be interesting, since closing above the 1386.00 area would almost invalidate the trend change signal. Unfinished business below at the gap back to Tuesday’s close suggests otherwise, so almost any probe above Thursday’s highs is likely to close negative Friday.

[/pay]What’s Next… (Outlook and opportunities)[pay]
Meanwhile, since Thursday’s closing action trended up, gapping down under the afternoon bias environment’s 1379.50 low would trigger a session-long decline. New lows for the week are not required, but there is surprisingly little support on the way back down there.[/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.