Trading Plan for 5/8

If the Dow’s prior thousandaire levels have begun near-term tops… then should Tuesday’s 15,000 mark resolve differently? Maybe initially, with confident buying pressure suddenly finding the has stopped again, with even fewer chairs remaining.

Pattern points… (Setups and technicals)[pay]
Tuesday’s rally to fresh highs above 1515.25 was underway into and out of the open. A steep, deep reaction down to 1611.75 ended abruptly, and then recovered ploddingly back into positive territory. Then the rally resumed.

The bias environment probed fresh session highs, and then the rally stopped again. This pause never threatened to reverse down, but the rally didn’t resume. The position-squaring window came and went, within a 2-tick range either way of 1621.00.

The two-day pattern through Monday’s close was likely to repeat. If Wednesday also follows the template, then it will not close above Tuesday’s highs — although fresh highs intraday are likely. The actual ranging and the actual close would all but dictate Thursday’s pattern.

[/pay]What’s Next… (Outlook and opportunities)[pay]
Tuesday afternoon’s 1623.75 bias-up target became unfinished business above. It was too close to the afternoon’s ranging at session highs for a hold-long to be compelling. There is still vulnerability to probe up to 1631.00 Wednesday, if not already overnight. Meanwhile, a dip has room down to 1615.00-1618.00 before threatening to reverse momentum down. [/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.