Technical Outlook:
- After a 3-day bounce, the market pulled back on Friday and formed a bearish engulfing candle pattern over the last two days.
- It is essential here that the bulls continue the pattern to new all-time highs. By failing to make new all-time highs, the market will create a lower-high and a higher-low, adding additional directionless inside of a range bound market.
- SPX still holding all the moving averages.
- Volume ticked slightly higher and back to average levels on Friday.
- For the bears, pushing below last Monday’s lows is absolutely key here which sits at 2063.
- Inverse head and shoulders pattern on the daily chart that will confirm if price action can break through to new all-time highs.
- VIX action is concerning from a bullish standpoint as it managed to hold year long support below – the same area where each downside reversal on SPX has occurred at in the past five months.
- T2108 (% of stocks trading above the 40-day moving average) diverged from Friday’s price action, by climbing an additional 10.1% to 37.5%.
- Oil is once again become a problem for the market again, as it broke the March lows on Friday.
- Nasdaq is by far the best chart among the indices right now. Others are very much range bound, but the Nasdaq has established a higher-high and higher-low. If Apple (AAPL) can actually join this rally, which is a large % of the Nasdaq, the rally could really take off.
- The 30 minute chart of SPX is starting to look range bound. However, there is still a pattern of higher-highs and higher-lows.
- My biggest ongoing concern with the market right now is the inability to establish new, clear-cut all-time highs that leads to an expansion of price as well. Instead SPX gets bogged down in the 2120-2130’s range and reverses course each time.
My Trades:
- No new swing-trades added to the portfolio.
- Closed out COST at $145.49 for a 0.6% gain.
- 30% Long / 70% cash.
- Remain long: UPRO at 68.26, QLD at 77.84, NFLX at 107.63.
- Will look to add 1-2 new positions today if the market continues to trend favorably.
- Join me each day for all my real-time trades and alerts in the SharePlanner Splash Zone
Chart for SPX:
