My Swing Trading Approach
Put my stops in on my current trade setups, look for a washout in the market that allows for a possible bounce from there. Otherwise, I don’t plan to trade this market at all today, unless a bottom can be put in place first. The potential for a very nasty market today, beyond the pre-market weakness looms large.
- Volatility Index (VIX) – Looking at a 22% gap higher, to take it into the 24’s today. Look for a test of the month’s highs as well.
- T2108 (% of stocks trading above their 40-day moving average): I suspect today’s move will put T2108 back into single digits where it will be hitting a very extreme oversold reading.
- Moving averages (SPX): Broke the 200-day moving average and currently trading below all the moving averages. The 10-day moving average continues to provide heavy resistance.
- RELATED: Patterns to Profits: Training Course
Sectors to Watch Today
Technology led the way yesterday, which has been a rarity for this market of late. Watch to see how it fares today relative to the other sectors to see if it will ultimately bounce off the lows or not. Financials began the next leg lower. Absolutely the worst sector to be in right now. Healthcare testing the rising trend-line off of the April lows. Discretionary will be testing key support, possibly opening below it at the open today. Again, a market leader yesterday, that will be key to whether this market can recover at all today. Expect CAT’s earnings to drag Industrials down in a big way.
My Market Sentiment
Some severe market weakness with a massive gap lower. Pre-market $SPY is right around the lows from earlier this month. The lows will be key to today. Break them, and the market will likely wash out further. At that point you are looking for the emotional bottom moment, that is established once everyone sells out because they can’t take the pain any longer. That is when you see the big money start flowing back in for a big bounce.
S&P 500 Technical Analysis
Current Stock Trading Portfolio Balance
- 2 Long positions