Trading Plan for 4/3

If the market planned to top this week… then it probably missed that boat Wednesday. A second consecutive higher close confirmed Tuesday’s breakout, requiring eventually for there to be at least third. An interim dip is possible, but only a dip.

Pattern points… (Setups and technicals)[pay]
Unless, of course, Tuesday’s breakout close wasn’t. But reasons to suspect its relevance should be rendered moot by Wednesday’s higher close. And Wednesday’s session wasn’t suspicious, being the past week’s most bullish performance. Despite maintaining gaps up, none of the three prior sessions trended higher in the morning, and higher still in the afternoon.

Ironically, Wednesday was the past week’s first session not to gap up. It didn’t have to.

That hesitation suggests keeping alert for a downdraft before Friday’s report, into it, or even through it. But rejecting Wednesday’s new high close by immediately gapping down would create unfinished business above that needs to be filled. Already fulfilling the minimum required third higher close on Thursday might be blind-sided by Friday’s report, but that’s kind of close to be an actual top.

[/pay]What’s Next… (Outlook and opportunities)[pay]
The afternoon before monthly Employment Situation reports tends not to trend, perhaps from anxiousness. By the same token, Thursday morning can be extra volatile with last-minute posturing.[/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.