Trading Plan for 6/26

Monday’s drop resumed Thursday’s effort… or, ended it. In any case, a lot of selling pressure has been expended to retest prior lows — not yet breaking them, and not yet signaling the trend has reversed down.

Pattern points… (Setups and technicals)[pay]
Monday afternoon stair-stepped higher to 1310.25 from the 1302.50 noon low. But buyers gained no traction for the effort. That wouldn’t necessarily be bearish, except that buyers tried.

The noon hour’s 1306.00 high was probed by 3 points during the bias environment. Yet, the bias environment was exited back at the noon hour’s 1306.00 high. The bias environment’s 1309.00 high was attacked by a 3-1/2 point surge into the 3:20 window’s exit, but not exceeded until later.

Diving to almost 1305.00 through the cash session close proved that buyers gained no traction for their earlier efforts. Since it wasn’t for lack of trying, that is potentially bearish. Resuming the decline at Tuesday’s open would be likely to extend down.

Otherwise, buyers can still gain traction immediately Tuesday despite not gaining traction for their efforts Monday. Gapping up, preferably above 1315.00, would get every benefit of the doubt for resuming Friday’s recovery effort.

[/pay]What’s Next… (Outlook and opportunities)[pay]
Recovering overnight from attacking Monday’s 1302.25-1303.25 lows (or from probing lower to 1300.50 or to 1297.25) would help to greet the day with even less ballast preventing lift-off. But overnight bounces that are rejected through Tuesday open would keep alive the decline’s momentum.[/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.