Trading Plan for 6/19

Another Sunday night gap up… another Monday morning tumble. But this one recovered to probe positive territory. The question whether its recovery actually gained any traction.

Pattern points… (Setups and technicals)[pay]
Immediately recovering 1335.25 at Monday’s open would have signaled a new rally leg underway. Any resistance at Sunday night’s highs would have been irrelevant. But Sunday night’s fresh high up to 1347.50 was retraced 20 points down to 1327.50 at Monday’s open. A new rally leg would need another signal.

Not just another signal, but a bigger signal.

Monday afternoon’s range developed entirely above 1335.25. But the cash session close was still testing 1338.00, essentially Friday’s expiration close. That’s not bigger.

Buyers haven’t exploited the hesitation, other than to range sideways, no different from sellers having failed several opportunities to regain traction Monday morning. The afternoon’s 3:10-3:20 window trended down, and its 1339.00 origin wasn’t recovered (not until after the cash session close), but sellers have yet to exploit that opportunity.

[/pay]What’s Next… (Outlook and opportunities)[pay]
It’s essentially equilibrium, at a trend extreme. If buyers are gaining control, then Tuesday’s open can gap up to 1345.75 and extend through Sunday night’s highs. If sellers are regaining control, then another probe under 1331.00 should find no support. [/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.