Trading Plan for 8/12

Tick, tock… The weekend’s illiquidity can invoke fear of not being long, as much as fear of being long. A squeeze or a dive into the weekend wouldn’t be surprising. [pay]

Pattern points… (Setups and technicals)
Thursday’s session took a major turn from its pre-open indications. A 30-point rally recovered 1126.00-1128.00 and 1132.00 in time to shift momentum upward. No further selling attempt was very productive, much less gained traction.

At least, not until the last 15 minutes. Not until testing 1178.00, all the way up to 1184.00. Both Monday’s 1178.25 post-open high, and Tuesday’s 1175.50 last-minute high, were probed as resistance and not recovered. Buyers expended energy without gaining traction.

A trend that isn’t gaining traction can still extend, by gapping. Gapping up Friday above 1182.00 would target 1199.00. Remember when 17 points used to mean something? The next higher targets do: 1226.00-1230.00, 1242.00, and 1269.00.

But the higher targets come into play only if 1199.00 were exceeded. And there’s no assurance of even putting it into play above 1192.00. Almost any initial weakness Friday under 1163.00 could extend down to 1143.50.

What’s Next… (Outlook and opportunities)
This being a Friday, the morning’s bias signal is likely to persist through the noon hour. And this being an amazingly volatile environment, the afternoon bias is likely either to extend the morning’s trending, or else reverse it sharply… Thursday’s Market Wrap recording is available here.
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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.