Pre-market update:

  • Asian markets traded 0.8% higher. 
  • European markets are trading 0.4% lower.
  • US futures are trading 0.1% higher ahead of the market open. 


Economic reports due out (all times are eastern): ICSC-Goldman Store Sales (7:45), Redbook (8:55), Factory Orders (10)

Technical Outlook (SPX):

  • Yesterday’s trading session represented more of a day of consolidation then one where we saw price expand. 
  • Dip buyers are continuing to buy up the weakness in this market. 
  • SPX has stayed on the upper Bollinger Band for 6 straight sessions, which is very difficult to sustain. 
  • Hanging man candle also formed on SPX. Often times this can signal a market reversal, though its accuracy is sketchy at best. 
  • VIX continues to hover at the critical support level dating back to April of 2013. 
  • Reference points for the current rally can be seen on recent and extended rallies that started on the following dates: 12/18, 2/6 and  4/14. 
  • The current rally has only rallied 50 points so far, and it is not out of question, considering how long we were in consolidation for, that SPX might still rally another 30-50 points. 
  • The only moving average that has shown any significant measure of support recently has been the 50-day moving average. That is the only one I would stay focused on at this point. 
  • A pullback to 1897-1900 is completely fine, but must hold that level. 
  • There does remain a significant gap up to fill from 5/27 on the SPY chart. 
  • Nasdaq continues to make a strong push out of its basing pattern. A move towards 4300 should be in short order. 
  • If the SPX, over time advances well into the 1900’s, then it likely becomes that the correction everyone was looking for, took place over time and with consolidation during the March, April and May months and not with a significant pullback. 
  • The number one priority of the bears has to be to get price back below 1900 and ideally back below 1883.
  • The short-term support rising off of the 4/28 lows continues to hold up well. 
  • The market doesn’t care about the economy nor earnings. That is not what is driving it. The market only cares about what the Fed is doing to keep equities propped up. 

My Opinions & Trades:

  • Did not close out any positions yesterday. 
  • Added two new long positions yesterday. 
  • I will look to add 1-2 new long positions today. 
  • Remain long AMAT at 20.04, LAZ at 50.55, AKAM at 54.52, BIDU at 166.96, BBY at 27.37. 
  • 70% Long / 30% Cash
  • Join me each day for all my real-time trades and alerts in the SharePlanner Splash Zone

Chart for SPX:

SP 500 Market Analysis 6-3-14