Trading Plan for 7/8

[pay]Pattern notes.
Here’s one more look at the bigger picture, while the bigger picture still depicts topping. One more day should either make the downtrend obvious, or else show sellers losing traction. And sellers losing traction at this stage of this pattern might as well be bullish.

Sellers losing traction here would be bullish because there is otherwise so much in their favor. The third consecutive bounce failing. The latest bounce’s low giving way as support. A last-minute surge Monday that was invalidated almost immediately at Tuesday’s open. And inappropriate optimism as the current drop stuggles not to touch May’s prior lows.

This not a Head & Shoulders, so a break under the “neckline” won’t be required to accelerate the decline’s pace, or eventually to be retraced. Indeed, the breakout probably already occurred Thursday. The question is whether a corrective bounce will come that much sooner – e.g. upon testing the 866’00 area – or whether the downleg will unfold relentlessly.

Indicators and Internals.
RSIs printed low oversold levels as the last hour’s first lows printed. Lower lows followed into the close, and their RSIs were also oversold, albeit not at their lowest. Despite price firming to nearly 880’00 into the close, the 875’25 low requires retesting.

Wednesday’s opportunities.
Tuesday’s close was very vulnerable to extending down at some point overnight to trigger a gap down at Wednesday’s open. A bounce isn’t required, but one would likely test 883’00, and potentially 889’00.[/pay]