Pre-market update (updated 9am eastern):
- European markets are trading mixed.
- Asian markets traded -0.6% lower.
- 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), Rebook (8:55am), Treasury Budget (2pm)
Technical Outlook (SPX):
- SPX rose on Friday for the seventh consecutive session and nine out of the last ten.
- We closed just below the upper Bollinger band, as the market continues to expand higher just below the upper resistance band each day.
- Volume on the rise yesterday dramatically tapered offer and back to the levels we saw on Thursday.
- Fear has completely escaped this market which puts investors, unknowingly in a very vulnerable position.
- Also the amount of margin being used to buy stocks are at levels that historically have let to notable reversals in market action.
- I'm looking for a pullback more than anything at this juncture and an opportunity for stocks to create more favorable setups to the long-side as a result.
- We are extremely oversold in the short-term.
- While we can still move higher from here, I believe there is far more risk over the next 2-3 days in doing so.
- Significant bearish divergence on the T2108 as the market is putting in recovery highs, the T2108 (% of stocks trading above their 40-day MA) is significantly lower.
- The weekly chart shows a strong breakout in place.
- VIX sold off hard yesterday and dropped back into the mid-11's.
- Both channels (July October 2012) and the price channel we are currently in are very similar in nature.
- We haven't seen a market pullback in excess of 4% since October/November time-frame.
My Opinions & Trades:
- No new positions added yesterday.
- Closed out ADBE at $41.10 for a 5.7% gain.
- Closed out LVS at $53.23 for a -3.1% loss.
- Closed out TRI at $30.97 for a -3.4% loss.
- Remain Long SLV at $27.97; Short ALXN at $91.65
- Here is my real-time swing-trading portfolio and past-performance
Chart for SPX: