Pre-market update:
- Asian markets traded 0.1% lower..
- European markets are trading 0.5% lower.
- US futures are trading 0.2% lower ahead of the market open.
Economic reports due out (all times are eastern): Janet Yellen speaks at Jackson Hole
Technical Outlook (SPX):
- SPX tested and closed at new all-time highs. This is huge considering just earlier this month, the majority of traders believed that a top had been established and it was moving much lower.
- Without a doubt now, this is not a dead cat bounce, but a significant move for SPX.
- Short-term the market is becoming very overextended to the upside. Some consolidation wouldn’t be out of the ordinary here.
- Janet Yellen speaks at Jackson Hole, which historically has the tendency to create some extra volatility for the market. Be prepared for anything.
- A good indicator for determining short-term direction in this market is the 5-day moving average – right now SPX is strongly above it .
- After an 88 point rally in the last 10 days, SPX 30 minute chart has become extremely stretched.
- VIX has barely fallen in the last 3 days. This time just 0.2% and to close yesterday at 11.76.
- At this point I wouldn’t be surprised to see some profit taking in the market, but yet, the market can always rally much, much more than you could ever expect.
- SPX is well into overbought territory.
- 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 Trades:
- Added one new long position yesterday.
- Did not close out any positions yesterday.
- Remain long AAPL at 95.56, FB at 72.53, ESRX at 71.01, NFLX at $454.91, CMI at 142.79, ETFC at 21.76.
- Will look to add 1 new long position today and also look to close out positions that are extended to the long side.
- 70% Long / 30% Cash
- Join me each day for all my real-time trades and alerts in the SharePlanner Splash Zone
Chart for SPX:
