Pre-market update:

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


Economic reports due out (all times are eastern): Durable Goods Orders (8:30), FHFA House Price Index (9), S&P Case-Shiller Home Price Index (9), PMI Services Flash (9:45), Consumer Confidence (10), Richmond Fed Manufacturing Index (10), State Street Investor Confidence Index (10), Dallas Fed Manufacturing Survey (10:30)

Technical Outlook (SPX):

  • First time ever, SPX has closed above 1900. The psychological barrier has been breached. 
  • I think there is a good chance that bears will start covering their existing short positions as there is little reason to hold on to them at this point. 
  • Volume waned the last three days of trading last week. Likely due to traders starting their holiday vacation early. 
  • SPX back into overbought territory. 
  • VIX broke year long support at 11.57 and now trades at 11.36.
  • 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 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.
  • We are starting to see where SPX is pushing its way out of the congestion that it has been mired in for three months now. 
  • The 50-day moving average continues to be a significant moving average of support level to watch going forward. 
  • The short-term support rising off of the 4/28 lows continues to hold up well. 
  • In re: SPY: Don’t be troubled by the heavy volume on down days versus the weak volume on up days – that has been happening for years now. 
  • 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:

  • Closed out EMC at 26.51 for a 2.8% gain. 
  • Added one new long position yesterday.
  • Will look to add 1-2 new long positions today. 
  • Remain long GLW at 20.95, LVS at 73.16, GOOG at 535.16, TIBX at 19.74.
  • 50% Long / 50% 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 5-27-14