Trading Plan for 9/2

If the rally could have left breadcrumbs before the weekend… then why did it ignore several opportunities? It’s not necessarily bearish, except for missing an opportunity to behave bullishly.

Pattern points… (Setups and technicals)[pay]
Pre-holiday volatility seemed to evaporate into the afternoon. Dropping quickly from noon’s 2001.75 session high fell into a narrow range around 1998.75, which had been the session’s opening print. The position-squaring window surged back up to 2001.75, before retracing entirely to close back at 1998.75.

That late surge’s failure was just one more missed opportunity to entrench the rally. Closing higher could have created a “holiday high,” or a new trend high close on a Friday, neither one tending to be a durable trend extreme. Reversing down immediately would have been likely to recover.

Similarly, no complexity to the 2003.75 overnight high prevented it from being a “new Globex trend extreme.” Its retest intraday would have been required, eventually if not the same day. Even gapping up from Thursday’s flat close to indicate new sponsorship, indicated the new sponsorship wasn’t strong hands since it couldn’t extend above the open.

Durable rallies tend to employ those tactics as a self-preservation technique. Not doing so isn’t bearish. Except that ignoring multiple opportunities despite being so well-positioned does make it difficult to extend higher without first dipping deeper. And difficult to avoid dipping deeper if first extending higher.

[/pay]What’s Next… (Outlook and opportunities)[pay]
This being a holiday weekend, there is no Saturday Strategy Session. The chartroom will be open Sunday night for the 6pm Globex open, which ends at 1pm ET Monday before re-opening at 6pm Monday. Please have a safe and happy holiday weekend![/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.