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Pre-market update (updated 9am eastern):

  • European markets are trading -1.1% lower.
  • Asian markets traded 0.7% higher.
  • US futures are trading moderately lower ahead of the opening bell.

Economic reports due out (all times are eastern): MBA Purchase Applications, Pending Home Sales Index (10am), EIA Petroleum Status Report (10:30am), Farm Prices (3pm)

Technical Outlook (SPX):

  • SPX nearly broke out of consolidation yesterday, just finishing a fraction of a  point within the boxed in area outlined below. 
  • Today we are faced with the prospect of reversing to the downside with a large gap down. 
  • These large gap downs have been problematic for the bulls to maintain. They often lead to the dip buyers trying to fill the gap after the first hour of trading. 
  • We've pulled back off of overbought conditions quite nicely. 
  • Consolidation continues to be the theme on the daily. We need to see either a break to the upside of 1563, or a break to the downside of 1538 to determine the market's next move. 
  • Volume continues to remain steady over the past week and a half of trading. 
  • Dead-cat bounces, like some may determine Friday to be, have really been non-existent of late. Once they bounce, they just keep going higher, no true reversals that takes us lower than the previous lows reached. 
  • We have seen the volume flow in much stronger on the sell-offs then on the days when the market rallies.
  • VIX dropped back into the 12's after yesterday's rally. 
  • I don't recommend using market bounces as an opportunity to reload your short positions at this time. 
  • Ideally, we are still in need of a more sustained pullback to 1500-1510 level simply for the reason, that it would once again bring stocks back to a place with more ideal setups and opportunities for trading. 
  • Also the amount of margin being used to buy stocks are at levels that historically have led to notable reversals in the market. 
  • 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:

  • Added BWLD yesterday at $86.53
  • Remain Long SLV at $27.97, SRPT at $33.07, GG at $33.55, HOS at $44.92.
  • Remaining patient at these elevated price levels - not going to force position that aren't there. 
  • Here is my real-time swing-trading portfolio and past-performance

Chart for SPX:

S and P 500 Market Analysis 3-27-13

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ryan1Ryan (@shareplanner) specializes in swing trading strategies and is the founder of SharePlanner which he created to help and teach others on how to trade stocks better using multiple approaches and time frames. Each day you can count on Ryan to provide his trading advice as well as transparency in every trade that he makes. Ryan Mallory resides in Central Florida with a wife of seven years as well as one lively son. More >>

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