Trading Plan for 7/10

If the market has been conditioned for another Pavlovian repsponse… then that conditioning is to reiterate buying weakness, being likely to resolve at fresh highs. Probing fresh highs Wednesday would suggest that training wasn’t yet complete.

Pattern points… (Setups and technicals)[pay]
The 1648.00 area was known resistance. It was unknown how aggressively it might be rejected, if rejected, at all. That is still unknown. Three tests through three timing windows Tuesday afternoon still have yet to break lower. Their reactions down each held 1645.00-1646.00. That’s barely a 4-point range, for the entire afternoon, hovering at fresh highs.

The relatively narrow range did persist through the bias environment lapsing at 2:30, making a decline unlikely. Or, making a decline unlikely to extend down, or likely to recover entirely. It was the former — a late dip from 1649.00 fell back to 1645.00-1646.00.

Once again, neither sellers nor buyers gained traction for their efforts. Trending in either direction without delay would require gapping open. Opening within the range could still try trending, but probably only temporarily. If testing the 1648.00 area is going to end the rally, and that’s not obvious at Wednesday’s open, then it probably won’t be obvious before Thursday.

The afternoon’s 1650.00 bias-up target was left outstanding above, and the gap back to Monday’s 1634.00 close is outstanding below.

[/pay]What’s Next… (Outlook and opportunities)[pay]
Wednesday morning’s econ reports are uneventful. But the afternoon’s FOMC Minutes should be a focal point with it providing a peak into potential tapering.[/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.