My Swing Trading Strategy
No new trades for me yesterday, as I sat on my hands and let the market throw everyone else around. Today’s pre-market strength may lead to an opportunity to re-short this market, and I won’t be placing a lot of faith, in the ability of the bulls to sustain this bounce.
Indicators
- Volatility Index (VIX) – The VIX gave up all of its gains early on and dropped by 1% from the previous day’s close. The indicator is still elevated, but yet to break the March highs, which would establish a higher-high.
- T2108 (% of stocks trading above their 40-day moving average): It continues to roll over, with another 2% decline taking it down to 45%. Very little support underneath for where it can find an ideal area to bounce.
- Moving averages (SPX): Closed a shade below the 20-day moving average, but expect a bounce back to the 5 and 10-day today for a potential test.
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Sectors to Watch Today
Discretionary led the way yesterday, as the market was split between advancing and declining sectors. Unusual to see the aforementioned leading while Technology leads the way lower, but that was the case yesterday. Energy struggled as well, but could be shaping up for a bounce here, especially with the 50-day underneath as it has been the place for previous bounces. Financials continue to be market’s weakest sector overall, and officially rolling over. Industrials appear to be right behind it.
My Market Sentiment
There should be an attempt at the open to reclaim the broken support level again but I am very skeptical of a market bounce here. I think there is a real chance of a pullback to rising short-term support shown below.
S&P 500 Technical Analysis
Current Stock Trading Portfolio Balance
- 100% Cash.
