My Swing Trading Approach

There are a lot of divergences occurring in this market right now and plenty of reason to be concerned. Based on the indicators that I follow, the market has been consolidating through time for the better part of a month. I plan to be cautious with new long setups, until we see a sustained bounce in the market.

Indicators

VIX – Despite a minor sell-off on Friday, VIX still popped 7.5% to 11.29. Much higher than what we have seen of late, and .01 from matching the highest close of the last two months. 

T2108 (% of stocks trading below their 40-day moving average): Remains at 48%, but another down-day making it four straight and 17 of the last 21 days. 

Moving averages (SPX): Russell 2000 testing the 50-day moving average, SPX below the 5 and 10-day and looking to test the 20-day MA today. 

RELATED: Patterns to Profits: An Intro Trading Course

Industries to Watch Today

Energy, Defensive, Cyclical and Technology are the strongest industries right now. Financials and Industrials are rolling over, with Basic Materials looking to follow suite. 

My Market Sentiment

Two days, but the depth of the sell-off can barely be seen, as the losses are slim to none, with the dip buyers buying every dip. More weakness today in the AM. Look for a test of the 20-day moving average. 

S&P 500 Technical Analysis

Current Stock Trading Portfolio Balance

• 4 long positions

Recent Stock Trade Notables:

• Square (SQ): Long at $36.00, sold at $37.35 for a 3.8% profit. 
• Adobe (ADBE) : Long at $175.20, sold at $179.62 for a 2.5% profit. 
• Alibaba (BABA): Long at $187.00, sold at 181.77 for a 2.8% loss. 
• Paypal (PYPL): Long at $71.94, sold at $72.98 for a 1.5% profit. 
• Lam Research (LRCX): Long at 210.41, sold at $205.20 for a 2.4% loss. 
• Baidu (BIDU): Long at $242.80; sold at 248.29 for a 1% profit.
• Nvida (NVDA): Long at $195.17, sold at $204.88 for a 5% profit.
• Humana (HUM): Long at $248.73, sold at $261.20 for a 5% profit.
• Square (SQ): Long at $32.92, sold at $34.36 for a 4.4% profit. 
• Nvida (NVDA): Long at $198.17, sold at $194.06 for a 2% loss. 
• Lennar Homes (LEN): Long at $56.63, sold at $58.10 for a 2.6% profit. 
• Lam Research (LRCX): Long at $185.23, sold at $192.24 for a 3.8% profit.
• Starbucks (SBUX): Long at $55.59, sold at $54.94 for a 1.1% loss. 
• Illinois Tool Works (ITW): Long at $148.63, sold at $151.23 for a 1.8% profit.
• Nvdia (NVDA): Long at $180.18, sold at $187.38 for a 4% profit. 
• Olin Corp (OLN): Long at $34.37, sold at $36.14 for a 5.2% profit.
• Lowe’s (LOW): Long at $77.97, sold at $81.52 for a 4.6% profit
• IBB: Long at $330.91, sold at $338.25 for a 2.2% profit. 
• Seagate Technologies (STX): Long at $34.35, sold at $33.89 for a 1.3% loss. 
• Wynn Resorts (WYNN): Long at $149.65, sold at $147.14 for a 1.7% loss. 
• Imax Corp (IMAX): Long at $23.03, sold at 22.26 for a 3.3% loss. 
• Marriott International (MAR): Long at $106.26, sold at $108.26 for a 1.9% profit. 
• Alibaba Group (BABA): Long at $170.63, sold at $170.29 for a 5.0% profit. 
• Workday (WDAY): Long at $106.91, sold at $104.90 for a 1.8% loss. 
• Nvdia (NVDA): Long at $170.45, sold at $187.94 for a 10.3% profit. 

See my entire swing-trading past performance here.