Technicals suggest mid-day reversal might stick

Sunday night’s open couldn’t wait… to probe Friday’s highs. And it couldn’t wait to reverse back down. Monday morning’s open couldn’t wait to attack Sunday night’s highs. And it couldn’t wait to reverse back down. The afternoon’s retest of the morning’s highs hasn’t reversed back down. Could this one stick?

Pattern points… (Setups and technicals)

Monday’s last surge up fulfilled the open’s 1257.50 target. Reversing down prematurely had helped to maintain the recovery’s potential. The surge stopped short of retesting Sunday night’s 1259.50 high. Reversing down prematurely again would have the same meaning.

Higher highs would still be likely to test at least 1262.00. And it could still be tested and its attraction neutralized overnight. Fresh highs above 1262.00 would target 1265.00-1267.00. Any higher would target at least 1278.50.

Regardless of the upside, there are new downside attractions below. The first is oversold RSIs at the noon hour’s 1236.50 low. The second is the afternoon’s no-bias trending above its 1248.00 bias-up signal. Its retracement is likely also to revisit the 1:20 1243.00 pint, which often fails to hold.

What’s Next… (Outlook and opportunities)

Monday’s close trended up, so gapping down under Tuesday afternoon’s 1241.50 low would trigger a session-long decline. Just failing to hold the 1246.00 area as support would all but end the rally, anyway. Meanwhile, the path of least resistance is up.

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.

Rod David develops analytical techniques that are designed to efficiently identify targets and turning points for any liquid stock or market in any time frame. He primarily analyzes S&Ps, generating several round-turn candidates daily. Rod publishes "Trading Plan" and more each session at the blog http://IfThenSignals.com.

About the Author
rod david

Rod David develops analytical techniques that are designed to efficiently identify targets and turning points for any liquid stock or market in any time frame. He primarily analyzes S&Ps, generating several round-turn candidates daily. Rod publishes "Trading Plan" and more each session at the blog http://IfThenSignals.com.

Comments
comments powered by Disqus