Pre-market update:

  • Asian markets traded 2.2% lower. 
  • European markets are trading 0.1% highr.
  • US futures are trading 0.2% higher ahead of the market open. 


Economic reports due out (all times are eastern): MBA Purchase Applications (7), Productivity and Costs (8:30), Janet Yellen Speaks (10), EIA Petroleum Status Report (10:30), Consumer Credit (3)

Technical Outlook (SPX):

  • Huge sell-off yesterday at the key price area of 1883. 
  • First time SPX is trading below the 10-day moving average since 4/15. 
  • SPX also closed at the day’s lows, which is usually a sure sign that there was a lot aggressiveness in the selling yesterday – every attempted rip higher was immediately sold. 
  • The converging 20-day and 50-day moving averages will be a key player today at 1864-5.
  • Before the momentum can really turn in the bear’s favor they need to push price below 1850.  
  • Volume was slightly higher yesterday but still unimpressive on SPY. 
  • Now for almost three weeks, SPY has continued to see dwindling and below average trading levels. 
  • Short-term, upward trend-line that formed off of the 4/11 lows on SPY was broken yesterday. 
  • The 30-minute SPX chart is a bloody mess with no sense of direction. 
  • In this market, you have to be aggressive with the gains. Take them quick, and don’t expect them to last. 
  • 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:

  • Added JCI yesterday as a short at 44.68..
  • Did not close out any trades yesterday. 
  • Will look to add 1-2 new positions today.
  • Remain short MT at $16.03, TEL at 59.01, JCI at 44.68..
  • Remain long BHI at 70.04.
  • Short 30% / 10% Long / 60% 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 5-7-14