Trading Plan for September 6, 2011

Current Long Positions (stop-losses in parentheses): QCOM Oct 60 Calls, AAPL Sept 420 Calls, SPY Sept 124 Calls

Current Short Positions (stop-losses in parentheses): None

BIAS: <1% Long

Economic Reports Due Out (Times are EST): ISM Non-Manufacturing Index (10am)

My Observations and What to Expect:

Futures down very hard heading into the morning open – in excess of 2%
S&P poised to open up below the 10 and 20-day MA’s.
It is also looking to test the trend-line off of the 8/9 lows, which currently finds support at 1137.
Two major price support levels to watch for tomorrow, is the 1120 and the 1101. I think another test of the 1120 level, will result it in finally breaking and challenging the 1101 level.
We are no where near being oversold in the short-term.
If we do test the 1101 level in the near term I expect it to be heavily defended by the bulls, and for us to see a potential rally off of that level, which could make for an interesting bounce play.
If you are short – good job! – however, be careful of potential intervention that creates an instant short squeeze that could come out of European countries, ECB, or the Fed.
My Conclusion: Being short is the only bias worth having right now. Look to cover at key support levels already mentioned.

Here Are The Actions I’m Taking:

Sold the remaining 2/3’s of my SPY Sept 124 calls on Thursday morning at 1.90 from 0.92 for a +100% gainer.
I’ll be back at the helm on Tuesday afternoon, after having taken my first vacation (a mini-one at that).
May have the opportunity to jump in some short plays tomorrow. We’ll see what kind of opportunities arise.
Follow me in the SharePlanner Chat-Room today for all my live trades and ideas (as well as everyone else’s).