My Swing Trading Approach

Stopped out of two of my long trades, but quickly hopped back in once the market showed signs of bottoming and rallying. I may add one additional long position today if the market can put together a convincing rally, but more likely than not, I’ll be watching from the sidelines and letting my current positions do the heavy lifting.  

Indicators

  • Volatility Index (VIX) – Well off of its highs of the day, and nowhere near the 10/11 highs that were established. May be looking to challenge last week’s lows going forward. 
  • T2108 (% of stocks trading above their 40-day moving average): An 11% decline yesterday down to 13%, but we were as low as 10% at one point. Managed to establish a higher-low, while $SPX was breaking down and establishing new lows. 
  • Moving averages (SPX): Still below all the major moving averages, but I suspect we’ll see a test of the 10-day moving average, which has perfectly rejected price four times in the past week. If it can break through, it would signal a more bullish outlook going forward. 
  • RELATED: Patterns to Profits: Training Course

Sectors to Watch Today

Real Estate and Staples were the only two sectors to finish in positive territory. The former, is trying to establish a higher-low on its daily chart and possibly initiate a rebound from two months of selling. The latter has a lot of resistance overhead that it will need to work through. Healthcare held on to its 200-day moving average and bounce higher, while Technology put in a possible double bottom that looks promising. Potential double top forming in Utilities. Materials dealing with extreme oversold conditions and may be finally ready to bounce with yesterday’s doji hammer candle. Energy broke below key support going back to May. I would avoid this sector going forward. 
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My Market Sentiment

Futures are well off of their overnight lows – they were about 26 points lower, now they are trading in positive territory. A lot of fed speak today. Absolutely paramount for the bulls today that they follow through to the upside on yesterday’s recovery off the lows or risk a retest of yesterday’s lows and probably more. 

S&P 500 Technical Analysis

Swing Trading Strategy Report 314

Current Stock Trading Portfolio Balance

  • 2 Long positions

Recent Stock Trades – See My Past Performance Here. 

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