Technical Outlook:
- Choppy trading session yesterday that saw price give up all of its gains early on before finally rallying in the afternoon.
- SPY and SPX were unable to break and close above the 50-day moving averages.
- This resistance level is in conjunction with price level resistance that confirms the double bottom at 1997.
- SPX looks to gap lower today, after a bearish night of trading in the futures market.
- Chinese markets opened back up last night after being off for one week. Very possible we see an increase in volatility as a result of this.
- 5-day moving average continues to trail the current price action nicely.
- If SPX can break 1997, there is little in the way of resistance until price action reaches 2045.
- SPY volume still light, but stronger than what we have see over the previous trading session.
- VIX continues to plunge as it drops another 5.2% yesterday down to 18.39.
- 25 point consolidating trading range on the 30 minute chart at recent highs on SPX as it attempts to try and break 1997 resistance.
- T2108 (% of stocks trading above their 40-day moving average) surged 23% higher yesterday
- After trading lower for two straight quarters (a rarity that hasn’t been seen since 2011), I wouldn’t be surprised to see the Q4 turn out to be very bullish for the market.
- The Fed has never raised interest rates at a point where the market was trading lower on the year.
- The large gaps in the market, the record number of stock buybacks, and ETFs that are constantly accumulating/dumping large chunks of stocks, and most importantly the high frequency trading, shows just how illiquid this market has become in recent years. These entities are the most responsible for the massive market swings that stocks incur each day.
My Trades:
- Closed MSFT yesterday at $46.20 for a 2.4% gain.
- Added one new long position to the portfolio yesterday.
- 50% Long / 50% Cash
- Remain long: EL at $80.52, AMZN at $543.24, SBUX at $58.67
- Will continue to play this market long while the market bounce persists.
- Join me each day for all my real-time trades and alerts in the SharePlanner Splash Zone
Chart for SPX:
