Trading Plan for 6/21

FOMC days can be very volatile… with wide-ranging moves that make sense waiting for patiently. As was expected, trending was unlikely to gain traction Wednesday, but not for lack of trying. Three big swings finished the day essentially unchanged from Tuesday’s close.

Pattern points… (Setups and technicals)[pay]
Overbought RSIs at Tuesday’s 1357.00 high still require a retest. Tuesday afternoon had attacked it. Now Wednesday’s overnight recovery attempt, and the FOMC reactions first recovery, have also come close without retesting.

Since sellers did not gain traction for their delay, the eventual retest should easily probe through the 1357.00 objective. Its minimum test has been expected to touch 1359.75, if not also 1361.50, but now 1364.00 has become much likelier.

Probing fresh highs Thursday — satisfying that much buying pressure and neutralizing the attraction above — would be vulnerable to reversing down through the close. Extending higher would put into play 1375.00 and 1386.00. In any case, in any sequence, closing under 1336.00 would reverse momentum down.

[/pay]What’s Next… (Outlook and opportunities)[pay]
Thursday’s econ calendar has been taking steroids in preparation for this day. Four high-profile items are due simultaneously at 10:00. The Jobless Claims reaction may have already offered clues to sentiment. Multiple big intraday trending is less likely than Wednesday, but there should still be plenty of volatility.[/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.