Pre-market update:

Economic reports due out (all times are eastern): Factory Orders (10), ISM Non-Manufacturing Index (10)

Technical Outlook (SPX):

Fourth time in the last five days the market has sold off. The problem for the bears is, during this time the amount of the sell-off is fairly minimal and lacks true panic.
As a result it becomes more likely that we’ll see the dip bought up again.
Despite a meager amount of selling on Friday it was enough to take us below the rising 10-day trend-line but I don’t consider this to be a major thread as it could still easily bounce here.
1809 going forward becomes the critical level in the short-term that the SPX must not drop below.
January is starting off in much the same way as December 2012 did – so keep that in mind.
Volume remains below average but we should see more volume come back into the market this week.
Volume totals over the past two weeks has been unbelievably weak especially when compared to historical volume patterns.
We remain firmly entrenched in overbought territory – but history shows that it can remain their for extended periods of time.
VIX dropped hard on Friday back down to 13.76 – a bullish divergence.
Trend-line support off of the October lows lies at 1795.- and currently out of reach for the bears.
There is absolutely no reason at all to be net-short this market.
Markets don’t care about the economy nor earnings. That is not what is driving them. The markets only care about what the Fed is doing to keep equities propped up.

My Opinions & Trades:

Did not sell any positions on Friday.
Added two new long positions on Friday.
Did not add any new positions on yesterday.
Remain long FLS at 72.25, RCL at 44.46, TRMB at 33.15.
I expect to add 1-3 new positions today.
Long 50% / Cash 50%
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Today’s Trading Plan: First Full Week in 2014