Swing Trade Approach:

Plenty of trade setups out there still, surprising, considering how much this market has risen in the past few months. Volume still remains above average and actually building upon volume levels from Friday. Still, you must be keep sliding your stops on your existing trades higher, so as to not risk losing all the hard earned profits of this rally. Be sure you are keeping a list of stocks to short, just in case price relents and turns lower. 

Indicators

• Volatility Index (VIX) – Dropping yet another 4% and down to 12.14, after spending much of the day in the 11’s. 
• T2108 (% of stocks trading above their 40-day moving average): Can’t breakout of the range going back to October. Very suspicious that this indicator lacks any substantial improvement. Currently only 60% of stocks are trading above their 40-day moving average. 
• Moving averages (SPX): Currently trading above all the major moving averages. 
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Sectors to Watch Today

Energy continues to surge higher, but hardly noticed was the constant flow of capital into Utility stocks all day long. This is the one sector that tends to struggle the most during a broad market rally and instead it is breaking out of a month long range. Technology printing substantially new all-time highs and back in the top 3 sector performers. Healthcare so overstretched, I find that to be the scariest sector to be forming new positions in right now. The risk/reward is horrible at this point. 

My Market Sentiment

Price continues to break through resistance levels with very little effort. Also worth noting is how many gaps are forming on the SPY daily chart. At some point, they’ll likely be filled, but that may not be in the here or now. The market is rallying the best I’ve seen at all-time highs since the one we saw in January of 2018.