Trading Plan for 8/26

If Friday had neutralized its upside attraction earlier… then the balance of the session might have fallen instead of surging. Either would have been a function of the weekend’s impending illiquidity. Now the new week will be greeted with weak-handed buying pressure largely fulfilled.

Pattern points… (Setups and technicals)[pay]
Thursday’s “session-long rally” setup had made a trending attempt to fresh highs above its 1657.75 high likely Friday. Friday’s pre-open surge fulfilled the minimum 1661.00 objective, but not the requirement for a probe to have a complex character. The afternoon’s ranging around Thursday’s 1657.75 high fulfilled the complexity, but not the trending attempt.

Finally, a late surge fulfilled both. And it came within 3 ticks of the noise range around 1661.00 up to 1663.25. The surge originated from under the both the noon hour and bias environment’s highs, so buyers gained no traction for their efforts.

It was the week’s highest close — in fact, Friday’s close was higher than the prior Thursday and Friday, which began the current trading range. But being a trading range, and not trending, Friday’s new relative high close is not a new trend extreme. So, no higher close is required before being able to reverse down.

[/pay]What’s Next… (Outlook and opportunities)[pay]
Join us this weekend for the Saturday Strategy Session at 9:30am ET. We’ll discuss the bigger picture, scenarios for Sunday night and Monday morning’s opens, and any individual stocks you think are timely.[/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.