Trading Plan for 6/9

[pay]About that close (How the prior session ended)
Tuesday’s late surge began too late to be sponsored by durable buyers. The expectation was for it to be no more than a short-squeeze. This is confirmed by its trajectory and relatively sizable gain. The squeeze did produce new session highs, and a probe above the overnight highs, although the latter held as resistance on a closing basis.

Pattern points (And technical influences)
Officially, closing above the open’s peak completed a Pivot Reversal. Technically, the setup is suspicious. Its last element was the close above the open’s peak. That leg originated too late to be sponsored by durable buyers. It doesn’t help that RSIs diverged negatively.

Even if the late surge were valid disaster was not averted. May 25’s prior lows weren’t probed first, so Tuesday’s “recovery” didn’t actually recover anything. A lot of unfinished business below has been neutralized recently, but more remains. And Tuesday’s session developed entirely within May 25’s range, making it an inside day that can’t signal much anyway.

Tuesday’s late surge may yet extend higher to fulfill the setup targeting 1073.50. It might only jump momentarily during Wednesday’s opening 15 minutes of volatility. But considering the late squeeze’s shakiness, immediately reversing down would also be credible – perhaps most credible.

Bottom line (My underlying premise)
The market’s current weakness is interesting in its timing. These first two weeks of the quarter’s last month typically find analysts checking in with the companies they cover. I look at a lot of stock charts, and there are plenty of ‘accidents waiting to happen.’ This is foreboding for July, to the degree that the past year’s rally was based on improving fundamentals. [/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.