The fear of just a few days ago has dissipated, as the Fed leaves well-enough alone. Gap Rules apply this morning. Overnight inventory is 100% long, so a fade is possible at the open. That means that your first focus should be on whether or not the gap between the open and yesterday’s high fills. Assume yesterday’s high is the cover-point and watch closely to see if prices move deeper into yesterday’s range or not.
Failure to fill the gap is a bullish signal and puts the Top of the Gap (the old one) and ONH (balance area low) into play, with an ultimate target of the downtrend line from the all-time high. Note that the last target changes trend on the daily chart which is very important. Corresponding strong internals would be a must.
A.F. Thornton