Pre-market update:

  • Asian markets traded 0.2% higher.
  • US futures are trading 0.1% higher. 

Economic reports due out (all times are eastern): Chicago Fed National Activity Index (8:30), Existing Home Sales (10) 

Technical Outlook (SPX):

  • SPX closed Friday yet again at all-time highs and finishing higher for the 11th time of the past 12 times and 15 out of the last 18 days. To say the least, July has been nothing but impressive. 
  • Any sell-off needs to find support off of the steep rising trend-line at the 1679 level on the SPX. Otherwise there isn’t much support
  • Plenty of room overhead before the SPX runs into any heavy resistance from the upper Bollinger Band. This has been an issue in recent past. 
  • 10-day moving average follows the rising trend-line mentioned above near perfectly, which should offer additional support. 
  • 1700 will be much talked about and should see some resistance as is traditionally the case prior to finally crossing the major threshold. 
  • Pay no attention right now that the market is over-extended. Such conditions rarely matters with the Fed’s involvement in the markets. 
  • Volume remains lackluster. 
  • 30-minute chart remains strong, and attempting to come out of recent consolidation. 
  • Huge drop in the VIX on Friday taking the readin to 12.54. 
  • Of concern is that there is really no significant key price support levels near current price action. 
  • This uptrend looks nearly the same as the one we saw on 4/19 and lasted until 5/19. I’m curious if it will lead to a similar extended pullback as a result. 
  • The SPX has typically risen in long winded streaks in 2013 where instead of the typical give-and-take that a market experiences, the bulls push higher with little in the way of obstacles or multi-day pullbacks. . 
  • Markets don’t care about the economy. That is not what is driving them. The markets only care about what the Fed is doing to keep equities propped up. 

My Opinions & Trades:

  • Sold AAPL at 425.19 for a 0.7% gain.  
  • Sold SBGI at 29.84 for a -2.8% loss. 
  • Added GOOG at 887.47 on Friday.
  • Added VIP at 10.48 on Friday.  
  • Current Longs: CL at 58.84, HRB at 30.19, SJM at 104.63, BDX at 99.98
  • May look to take gains in stocks that are stagnant and replace them with better setups today. 
  • Join me each day for all my real-time trades and alerts in the SharePlanner Splash Zone

Chart for SPX:

SP 500 Market Analysis 7-22-12