Trading Plan for 5/27

If a rally forms in a low-volume environment… can it gain traction? Already having neutralized all attractions above, momentum had better be enough to extend higher, or else there’s not much support below.[pay]

Pattern points… (Setups and technicals)
Thursday’s last 90 minutes can be characterized as ranging sideways around Wednesday’s 1324.50 prior high. That would excuse the 3-day weekend signal from not having sucked price back into the 1312.00-1320.00 range.

Last Thursday’s choppy ranging around 1340.00-1341.00 resistance was similar, creating pent-up selling pressure and then compensating for the delay by sliding into Tuesday’s night’s 1302.25 low. Thursday morning’s extended consolidation under 1316.00-1317.00 also created pent-up buying pressure, but that already played out intraday.

Immediately sliding or gapping down Friday could do by proxy what Thursday’s close failed to do, reverse back into the 1312.00-1320.00 range. Compensating for the delay would suggest extending down to the range’s lower-end, if not also lower.

Extending higher is possible, but less likely since the opportunity was not exploited through Thursday’s last 90 minutes. That was  plenty of time to put into play higher targets, or else to react down and refuel buyers, but neither was done. Extending hgher overnight may be the only way to avoid a downleg back into and through the 1312.00-1320.00 range.

What’s Next… (Outlook and opportunities)
Look for volume – what’s left of it – to start evaporating quickly by late-morning. The econ calendar is treacherous, and should keep the open lively. Trending after that will be difficult, especially if not already underway. [/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.