If Thursday’s dueling press conferences hadn’t happened… then would the overnight rally have extended higher intraday? No downleg was productive except momentarily. Ultimately, no downleg gained traction. If sellers were absorbed, then Friday should make that obvious pretty early.
Pattern points… (Setups and technicals)
Thursday’s session was over before it began. The highest objective at 1416.00 was tested already overnight. Two pullbacks targeting 1411.00 and 1409.00 were recovered (the second one from 1407.00) back up to 1416.00. An afternoon dip to 1411.00 was also recovered back to… wait for it… 1416.00.
It’s difficult to reverse trending on a Friday when Thursday produces a fresh high close. I don’t mean to imply that it is impossible, or even unusual. But the weekend’s impending illiquidity cuts into the afternoon’s participation, which leaves only the morning to to get something done.
Exiting the morning’s bias environment at 11:30 back under 1405.00-1405.75 would be vulnerable to tumbling into the close. But if the trend hasn’t reversed down by the noon hour, then an afternoon sell-off would be unlikely. The next higher targets would be 1422.00 and 1425.50, then 1433.00-1436.00..
What’s Next… (Outlook and opportunities)
Advance notice: Don’t forget about this weekend’s Saturday Strategy Session, which begins at 9:30am ET. Its link is found in the blog’s sidebar.
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.