Trading Plan for 8/30

The week began the way it had ended… with a wide intraday range probing fresh highs into the afternoon. Low-volume, pre-holiday trending isn’t very credible for being a durable upleg. The only question is how productive it can be before failing. [pay]

Pattern points… (Setups and technicals)
Straight up rallies like Monday don’t reverse down on a dime. That means the rally is likely to extend higher, and also means that immediately reversing down would very likely recover.

Nothing about Monday’s open would have turned me bearish unless  1188.50‘s retest had held. Nothing about Monday’s close would turn me bearish unless 1193.00 were rejected – broken on a closing basis, preferably through Tuesday’s close. If 1193.00 were in fact broken Tuesday, then it would likely be a close under 1193.00.

Otherwise, the next higher objective is 1226.00-1228.00. Monday’s close was still testing the afternoon’s 1206.75 bias-up target, without closing decisively above it. An immediate pullback is possible, but not required. However, 1206.75‘s test into the close should launch either an immediate pullback, or extend the rally at a much steeper pace.

Price action trended up into Monday’s close, and the afternoon’s 1199.75 low printed prior to the last hour. So, gapping down under 1199.75 could trigger a session-long decline. No other sell signal should gain traction without first probing fresh highs.

What’s Next… (Outlook and opportunities)
The post-close Market Wrap was recorded, and its link is here.[/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.