My Swing Trading Strategy

No new trades for me yesterday. Held on to my one short position, and watched the market go completely berserk in overnight trading. You have an active administration (not trying to be political here) that is actively engaged in countering every negative news piece that hits the wires with a positive one of their own, knowing that they can manipulate the algos into buying up everything they say. While there are plenty of trade setups out there, I am not overly inclined to do much, because when you can’t predict the direction of the market (and right now, nobody can), doing less will benefit you so much more.  

Indicators

• Volatility Index (VIX) – VIX had an inside day yesterday and dropped 8.1%. Likely to see some volatility in the coming days with US/China talk ramping up over trade. A break of 21 will be key for the bulls to push through. 
• T2108 (% of stocks trading above their 40-day moving average): Only recovered a small amount of the previous day’s massive sell-off. In all, it was a 8% increase, but only at 37%. Despite the market not being all the far off from all-time highs, the stocks underneath the surface are really struggling. 
• Moving averages (SPX) Still below all the moving averages except for the 200-day MA. 
• RELATED: Patterns to Profits: Training Course

Sectors to Watch Today

Technology bounced back yesterday and led the way higher, but still in a downtrend off of the September highs. Financials showing signs of a bear flag forming, and unable to hold its move above the 200-day MA yesterday. Discretionary continues to weaken even more so than Tech, and could see a triple top confirmation. 

My Market Sentiment

Candle body nothing more than an inside day for the market. Overnight price action is volatile and likely to continue into today with significant headline risk. The 50-day MA still acting as resistance, with nearby channel support below.

Current Stock Trading Portfolio Balance

• 1 short position.

Recent Stock Trades – See My Past Performance Here.