Pre-market update:

  • Asian markets traded 0.8% lower.
  • European markets are trading 1.3% lower.
  • US futures are trading 0.3% lower ahead of the market open. 


Economic reports due out (all times are eastern): MBA Purchase Applications (7), International Trade (8), Treasury Refunding (8:30), EIA Petroleum Status Report (10:30)

Technical Outlook (SPX):

  • SPX gave up and more the gains from Monday’s bounce. 
  • Bears remain in control of the market, but concerns of how much further they can really drive price down without a substantial bounce is a significant concern at this point. 
  • Russia and Ukraine conflict/turmoil is also creating additional uneasiness in the market. 
  • Some support off of the trendline formed from the March through May highs. 
  • Morning candle that had formed on SPY has been nullified. 
  • The sell-off didn’t just begin last Thursday with the hard sell-off, according to indicators like the T2108 (% of stocks trading above their 40-day moving average), stocks have been selling off since the beginning of July, while the overall market was simply consolidating. 
  • As a result, there is a good chance with all the extreme readings that market indicators are providing that we are near a market bottom and ready to bounce higher. 
  • I would not be getting short on this market, as the key/opportune time to have done so would have been in early July. At this point, one is simply chasing after the recent sell-off. 
  • Volume continues to come in strong. 
  • Long-term trend-line in place that started off of the lows from November 2012, is still in place, and could be tested at 1904 if the selling were to continue. 
  • The market doesn’t care about the economy nor earnings. That is not what is driving it. The market only cares about what the Fed is doing to keep equities propped up. 


My Trades:

  • Added one additional long position yesterday. 
  • Did not close out any positions yesterday. 
  • Will consider adding additional positions if the dip buyers come back into the market today. 
  • Remain long EBAY at 51.75, HPQ at 35.61, GPK at 12.00, AAPL at 95.56, FB at 72.53
  • 60% Long / 40% Cash
  • Join me each day for all my real-time trades and alerts in the SharePlanner Splash Zone

Chart for SPX:

SP 500 Market Analysis 8-6-14