Technical Outlook:

  • SPX managed to rally for the ninth time in the last ten trading sessions. 
  • The 5-day moving average continues to trail the current price action and now provides a clear indicator for determining price action going forward. 
  • Volume on SPY was one of the lowest on record for the year namely because of yesterday being Columbus Day and the banks being closed. It was on par with holiday Christmas volume. 
  • Last two days on SPY has resulted in it forming doji candles. A good sign that the market is attempting to work of oversold conditions through time and not price. 
  • SPX 30 minute chart signifies a bull flag at the recent rally highs. Very healthy. 
  • VIX fell for a tenth straight day which actually ties an all-time record. That was only matched previously in 2005 and 2009. A close lower today would establish a stand alone record. 
  • This week is relatively a quiet week in regards to the news front. I don’t expect the remainder of the week to be overly volatile. 
  • 2059 is the break-even level for the market on the year. It also happens to be where the 200-day moving average is sitting at. 
  • T2108 (% of stocks trading above their 40-day moving average) is currently trading at 65% – one of the biggest rallies I have ever seen in the indicator – considering that it was trading at 12% on 9/29/15.
  • The Fed has never raised interest rates at a point where the market was trading lower on the year. 
  • The large gaps in the market, the record number of stock buybacks, and ETFs that are constantly accumulating/dumping large chunks of stocks, and most importantly the high frequency trading, shows just how illiquid this market has become in recent years. These entities are the most responsible for the massive market swings that stocks incur each day. 


My Trades:

  • Did not close out any positions yesterday.
  • Added one new long position to the portfolio yesterday. 
  • 40% Long / 60% Cash
  • Remain long: EL at $80.52, SBUX at $58.67, DIS at $105.88.
  • My focus in trading remains to trade to the long side. 
  • Join me each day for all my real-time trades and alerts in the SharePlanner Splash Zone

Chart for SPX:

SP 500 Market Analysis 10-13-15