Pre-market update (updated 8:30am eastern):
- European markets are trading -0.7% lower.
- Asian markets finished mixed on the day.
- US futures are trading slightly lower ahead of the opening bell.
Economic reports due out (all times are eastern): ICSC-Goldman Store Sales (7:45am), Current Account (8:30am), Redbook (8:55am), Treasury International Capital (9am), Housing Market Index (10am)
Technical Outlook (SPX):
- Inevitable pullback yesterfday, and shouldn't be a concern at this point for the bull camp.
- No sign of panic yesterday during the sell-off.
- Volume confirmed this by being much lighter than the volume we saw in the run-up.
- Price action pulledback inside of the upper bollinger-band.
- Yesterday afternoon, near the close, we saw a surge of buying, that has been indicative of market behavior during QE1 and QE2. Now that we are in QE3, look for more of this behavior to continue.
- I don't think it would be surprising to see sideways trading or additional selling over the course of the next few days.
- Traders have their eyes fixed on SPX 1500, but it is more likely that this market will need to cool off some before moving higher.
- We are starting to come off of the short-term overbought conditions in the market.
- Fed's QE3 launch is going to add a lot of buying power to this market and drive more people out of interest-bearing assets and into equities in search of some kind of return.
- Going back years, there really is little in the way of resistance for the markets until it tests 1500.
- Resistance at 1437 and 1440 was broken with little problem and now becomes support.
- 30-minute chart looks like a bull-flag pattern.
- Upward trend-line off of the 6/4 lows has rising support at 1404.
- SharePlanner Reversal Indicator confirmed the move higher this past week.
- VIX above 14 despite yesterday's sell-off.
- One area of concern is the 3 large gaps off of the 6/4 lows that remain unfilled, including 6/6, 7/26, 8/3
- Should a sell-off ensue after the Fed action/comments today, look for support to come in at 1438.
- If another sell-off were to ensue, watch for a break and close below 1396 for a new lower-low in the market.
My Opinions & Trades:
- Busy day trading yesterday.
- Sold CRR at 72.77 from $72.27 for a 0.7% gain.
- Bought GMCR at $31.74.
- Bought GTAT at $6.73.
- Shorted PRGO at $113.26.
- Current stop-losses have been adjusted across the board.
- ALXN stop-loss moved up to $109.50
- Stop-loss for NLSN at $29.30.
- Stop-Loss for WYNN increased to $110.50.
- Stop-Loss for BEAV adjusted to $40.00.
- Remain long BEAV at $40.75, WYNN at $107.47, NLSN at $28.70, and ALXN at $102.53
- Track my portfolio RealTime here.