Trading Plan for 5/9

Despite rallying sharply… off session lows, Tuesday’s session confirms that the decline has resumed. It does not preclude there being another corrective bounce. But it does require any bounce to fail, and to ultimately probe new lows.

Pattern points… (Setups and technicals)[pay]
Tuesday’s bias environment was exited above the noon hour’s high, and the session’s last hour was entered above the bias environment high. None of this required the bias environment’s recovery to extend higher. But it made the pattern less likely to reverse down. Momentum took care of the rest, adding another 8-10 points.

The recovery’s 1362.00 high ultimately probed above Monday’s 1359.75 “higher prior lows.” Still being tested through the close, Monday’s resistance was not recovered. Similar to Monday, Tuesday’s buyers gained no traction for their effort. Similar to Tuesday, Wednesday’s open must gap above resistance to extend the rally. That is essentially 1366.00.

So, while the decline has resumed, the corrective bounce has probably ended unless Wednesday’s open were to immediately recover 1366.00. Simultaneously oversold 1-minute and 3-minute RSIs at the 1343.75 low require its retest. So does Sunday night’s “new Globex trend extreme.” Look out below when their retests are underway.

[/pay]What’s Next… (Outlook and opportunities)[pay]
Eurozone news is impacting price action, but so are US economic events. Be sure to check the calendar link.[/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.