My Swing Trading Approach

It is a new year, and I am 100% cash coming into it. I closed my only two positions out on Friday for a +1.5% profit in AMZN and a +1% profit in AAPL. I don’t want to get short right out of the gate, because the risk/reward won’t be favorable but will instead wait for the right ‘pop’ to get short on. 

Indicators

  • Volatility Index (VIX) – A huge pullback over the last four trading sessions, going from 36 to 25. Look for a pop today with the premarket weakness, could easily get back above 30 real quick. Nice series of higher-lows in place. 
  • T2108 (% of stocks trading above their 40-day moving average): Out of the single digits, but very little movement in this indicator considering how hammered it is. Currently sits at 11%. 
  • Moving averages (SPX): Trading back above the 5 and 10-day moving averages for the past two days, but don’t expect that to last. 
  • RELATED: Patterns to Profits: Training Course

Sectors to Watch Today

Healthcare has had one of the better bounces of late, but Materials continues its solid downtrend since January of last year. Financials should not inspire – textbook dead-cat bounce there. Technology running into some short-term resistance. 
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My Market Sentiment

Price action is running right up on resistance, and buckling as seen by the pre-market weakness this morning. Let this action play out. Hard to get short on it, if you weren’t short coming into the day. First trading day of the year tends to see a lot of action so be patient with those entries, but keep in mind the resistance barrier in the chart below. 

S&P 500 Technical Analysis

spx 1 2 19

Current Stock Trading Portfolio Balance

  • 100% Cash

Recent Stock Trades – See My Past Performance Here. 

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