My Swing Trading Strategy

I increased my long exposure yesterday by one position, however, the market wasn’t able to hold on to its early morning gains. The market could be setting up for a hard reversal higher following the morning gap down, which tends to be the more traditional bounce scenario. 

Indicators

  • Volatility Index (VIX) – A 10% bounce yesterday, with a rare closing in which the indicator closed near its highs of the day. Potential today to see a push towards 19-20.  
  • T2108 (% of stocks trading above their 40-day moving average): A 13% drop taking the indicator down to 30%. There is still room to fall but the selling in May hasn’t been all that aggressive, so I don’t expect we’ll see readings that were similar to what were experienced back in December of last year. 
  • Moving averages (SPX): Today sets up as potential test of the 200-day moving average. 
  • RELATED: Patterns to Profits: Training Course

Sectors to Watch Today

Technology and Discretionary were the strongest sectors in the market yesterday, while your more defensive sectors like Staples and Utilities really lagged the market. 
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My Market Sentiment

Yesterday’s sell-off was non-stop, but it did so without eliciting any panic from Wall Street. The volume was light, which makes me question the conviction behind yesterday’s move, if we don’t see greater volume levels going forward. Remember 2800 will be key today as to whether we confirm the head and shoulders neckline – but it has to close below it. 

S&P 500 Technical Analysis

swing trading strategy report 448

Current Stock Trading Portfolio Balance

  • 20% Long 

Recent Stock Trades – See My Past Performance Here. 

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