Technical Outlook:
- Hard sell-off yesterday, in a rather surprising manner. Little to no bounce throughout the trading session.
- Found support at the 20-day moving average.
- Watch the rising trend-line off of the October lows – It will be in play today at 2074.
- 200-day moving average has also provided some support/resistance throughout this past year. Could be another opportunity for SPX to find support again.
- Seasonal and technical factors considered, SPX still has a very solid edge to the upside this month.
- Numerous factors worked into yesterday’s sell-off which included the massive sell-off in oil yesterday that took it right back down to its August lows. A break in support here could result in a notable problem for the market going forward. Also, Yellen’s hawkish comments startled the market, and on top of that you had the horrific terrorist attack in San Bernadino.
- VIX rose 8.5% yesterday to settle in at 15.91.
- T2108 (% of stocks trading above their 40-day moving average) is showing some concerns here as it had one of its biggest moves in weeks by shedding 16% down to settle at 45%
- SPY volume yesterday was surprisingly average despite the heaviness of the sell-off.
- By breaking the resistance at SPX 2115, it will confirm a massive inverse head and shoulders pattern forming on SPX.
- SPX is back in the trading range that it has been stuck in since 11/19.
- SPY is essentially sitting in the middle of the range that has plagued the market all year long, outside of the August/September sell-off.
- For twelve years straight, the market over the course of the last 30 trading days of the calendar year, has yielded a net positive gain, and thus reinforcing the concept of the “Santa Rally”.
- A rate hike is expected out of December’s Fed meeting. However, I still would not be surprised if the Fed backed out of raising rates yet again. They’ve been doing just that for years now.
My Trades:
- Sold MDRX yesterday at 15.44 yesterday for a 4% gain.
- Sold BIDU yesterday at $211.36 for a 1.8% gain.
- Sold ETN yesterday at 57.07 for a 1.8% loss.
- Added two additional long positions to the portfolio yesterday.
- Will consider adding one to two new long position to the portfolio today, while also managing the profits on existing positions.
- 60% Long / 40% Cash
- Remain long: AMZN at $673.85, ADSK at $63.63, CRM at $79.86 and three other positions.
- Join me each day for all my real-time trades and alerts in the SharePlanner Splash Zone
Chart for SPX:
