Pre-market update (updated 9:00am eastern):
- Europe is trading -0.5% lower.
- Asian markets traded 0.1% higher.
- US futures are moderately lower.
Economic reports due out (all times are eastern): Chicago Fed National Activity Index (8:30am), Dallas Fed Manufacturing Survey (10:30am)
Technical Outlook (SPX):
- SPX closed higher for the 5th straight day and finished outside the declining channel.
- However, price has gone straight into price resistance at 1404-1410.
- Indices across the board are extremely overbought short-term, particularly the SPX after rallying 66 points in 5 trading sessions.
- Volume declined each day over the last 5 days, but that is primarily due to the holiday week, and is not a fair barometer to judge by.
- Despite the strong rally of late, the SPX failed to make a higher-high. As a result, I’d view this market with skepticism.
- Moderate-to-extreme gap downs have a difficult time sustaining their momentum, and often times results in a significant mid-day reversal that wipes away some or all of the days losses.
- SPX currently has recaptured the 10, 20, and 200-day moving averages.
- 30-minute chart shows price support at 1404, 1390, and 1376.
- VIX has dropped to 15-flat
My Opinions & Trades:
- Sold AET on 11/21 for a 3.5% gain.
- Sold ITW at 11/21 for a 1.2% gain.
- Still holding PHG 25.41 long.
Chart for SPX:
