Pre-market update:

  • Asian markets traded -0.4% lower. 
  • European markets are trading -0.5% lower. 
  • US futures are trading -0.2% lower. 


Economic reports due out (all times are eastern): Chicago Fed National Activity Index (8:30), PMI Manufacturing Index Flash (8:58)

Technical Outlook (SPX):

  • Heavy sell-off on Friday giving up much of the gains from Wednesday’s FOMC gains. 
  • Key support at 1709 held. 
  • At this point the last two days doesn’t worry me – it was more necessary than anything considering the fact that the SPX rallied non-stop from 1627 at the end of August all the way up to 1729. A 20 point pullback isn’t at all concerning. 
  • Volume over the last 3 days have been much stronger than what we saw previously. 
  • Despite the SPX being heavily down, the VIX managed to still drop nonetheless, though a lot of that has to do with triple witching on Friday (Options Expiration). 
  • A nice healthy pullback on the 30-min chart of the SPX on Friday. 
  • Apple is boosting the Nasdaq in the early going but little effect on the SPX with expected revenues at the high end of estimates. 
  • A 1-2 week period of consolidation at this point would not be surprising considering the price action that we’ve seen after similar run ups this year on the SPX. 
  • Continue to watch the 10-day moving average, and a break of which that might spur on a minor correction. 
  • I am continuing to trade to the long side, and for the foreseeable future. 
  • SPX back firmly in overbought status short-term. 
  • 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:

  • Added one new position to the portfolio on Friday. 
  • Did not close any positions on Friday. 
  • Tightened the stops on a majority of my positions to lock in profits. 
  • Currently 70% long / 10% short / 20% cash.  
  • Current Longs: SLB at 82.34, OSK at 46.91, EXXI at 27.54, FTNT at 20.63, BIDU at $143.15, BAC at 14.71. 
  • I’ll look to add one additional position to the long side today if conditions permit. 
  • Join me each day for all my real-time trades and alerts in the SharePlanner Splash Zone

Chart for SPX:

SP 500 Market Analysis 9-23-13