Trading Plan for 9/10

If Monday’s rally was due to a flailing Syrian intervention…  then is the market protected from reversing down? Probably not. Trending in response to inaction is never sustained, since the action can still be taken, and other factors are more relevant.

Pattern points… (Setups and technicals)[pay]
Monday afternoon’s probe above its 1667.75 bias-up signal came too late to trigger. The “no-bias trending” above it must be retraced, probably also down to the 1665.50 print. But Monday’s close held the 1669.00-1671.00 range.

So long as no other timing window were exited any higher, 1667.75 and 1665.50 are likely to be revisited. Exiting a timing window above the 1669.00-1671.00 range could delay the retest for a couple of days.

Meanwhile, just closing above the 1667.50 prior high has signaled a daily trend change to up. A second consecutive higher close Tuesday is needed for confirmation. I’ll believe it when I see it.

No-bias trending is the product of weak hands. So, the trend change signal was produced by weak hands. Closing above the 1667.00 trend change signal on weak-handed sponsorship suggests that optimism is already too high to be sustained. The alternative to a second consecutive higher close Tuesday should be a break back under 1661.00.

[/pay]What’s Next… (Outlook and opportunities)[pay]
Monday’s rally was probably encouraged by various developments throughout the day that undermined the Syrian intervention. Which is fine. But, even if valid, that can become too discounted. The earliest congressional vote isn’t likely before Wednesday, if by then at all.[/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.