Trading Plan for 4/30

If Monday’s late dip had bounced even slightly before the close… then a hold-long overnight might have been compelling. That was the setup’s only missing factor. A couple of other factors then undermined the setup, too, no matter how likely at least a temporary fresh high may be.

Pattern points… (Setups and technicals)[pay]
Ooh, so close… The likelihood of retesting the 1592.50 two-week old high was reinstated last week — pretty much last Monday, when the decline’s consolidation up to 1550.00 did not break lower, and instead recovered 1555.50. That put price back into the orbit of prior highs.

Retesting the prior highs was already satisfied to one degree on Thursday, when the gap was filled back to its 1588.00 close. The pessimistic delay in testing it, and the impatient selling that reacted down Friday, was still bullish from a contrarian perspective. That bullishness was fulfilled during Monday’s 4-point probe above it.

The retest of the two-week old high had potential, if not a likelihood, for doing more than just filling the gap back to the 1588.00 high close. The high close was itself the second consecutive higher confirming close of a breakout. That normally produces at least one more higher close.

By a 2-3 tick margin, Monday’s 1588.75 close fulfills that requirement.

[/pay]What’s Next… (Outlook and opportunities)[pay]
There remains potential for probing higher. Monday afternoon’s 1594.75 bias-up target is unfinished business above. And Monday’s last-hour dip all but fulfilled its 1587.00 limit. Deeper backing-and-filling is possible, but a probe of fresh highs Tuesday would be vulnerable to reversing down sharply intraday.[/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.