Pre-market update:

  • Asian markets traded 0.5% lower. 
  • European markets are trading -0.7% lower.
  • US futures are trading 0.1% lower ahead of the market open. 


Economic reports due out (all times are eastern): ICSC-Goldman Store Sales (7:45), International Trade (8:30), Redbook (8:55)

Technical Outlook (SPX):

  • Technically, SPX finished a shade above 1883, at 1884.66 but it wasn’t overly convincing and not  a move that you can embrace right away. 
  • Follow through is key today to show that it is indeed breaking out of this two month long trading range that price has been stuck in. 
  • Short-term, upward trend-line has formed off of the 4/11 lows and has held quite nicely since. 
  • Don’t rule out a reversal occurring here yet again by the market. I closed out one short position and added a long position to lessen my bearishness, but not completely sold on yesterday’s slight break.
  • Being nimble and patient for the market to show its hand here is KEY.
  • Dip buyers still remain strong, yet again buying up the weakness immediately after the market opened. 
  • Now for almost three weeks, SPX has continued to see dwindling and below average trading levels. 
  • SPX 30-minute chart shows an incredible amount of choppiness and indecision.
  • 10-day moving average continues to offer solid support for the bulls. A break of this moving average will be key for the bears. 
  • 20, & 50 day moving averages have converged together offering some support for SPX.
  • 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:

  • Covered JPM at 54.16 yesterday for a 2.5% gain. 
  • Added one long position yesterday. 
  • Will look to add 1-2 new positions today.
  • Remain short MT at $16.03, TEL at 59.01 and JPM at 55.52.
  • Short 20% / 10% Long / 70% 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 5-5-14