Technical Analysis:

• S&P 500 (SPX) has risen for a fourth straight day (before that it had dropped nine straight days). 
• SPX had a massive doji candle that formed yesterday, that puts into question the sustainability of this current rally. 
• Even more perplexing, the Dow Jones Industrial Average (DJIA) was up 218 points, while Nasdaq Composite Index (QQQ) was down -0.8% or 42 points, forming a bearish piercing pattern. Meanwhile SPX was slightly up/flat. 
• There is a clear rotation taking place in this market where money is flowing from tech and utilities and into defense, banks, and infrastructure. 
• CBOE Market Volatility Index (VIX) initially saw a decline down to the rising trend-line off of the August lows and bounced hard thereafter. This trend-line tends to be where plenty of market reversals take place, both big and large, with the latest being the bounce that led to a nine day sell-off in the market. 
• The decline in Oil Futures (/CL) yesterday looks to resume yet again today. The $43 price level will be a key level to watch. 
• Also watch oil’s impact on equity prices, particularly as it drops below $43, and most certainly if it drops back below $40. 
• 30 minute chart of SPX shows a solid series of higher highs and higher lows, but considering the time span and the steepness of the trend, I wouldn’t expect it to last. 
• Volume spike on SPDRs S&P 500 (SPY) over the last two days, should be a concern for traders as similar volume patterns (i.e. Brexit) has resulted in market tops/bottoms. Be cautious. 
• Poor breadth continues to dominate this market as yesterday, decliners outpaced advancers 8 to 7, despite the Dow and S&P 500 finishing in positive territory. 

My Trades:

• Added one new swing-trade to the portfolio yesterday. 
• Covered DIA yesterday at 187.05 for a 1.8% loss. 
• Will look to add 1-2 new swing-trades to the portfolio today. 
• Currently 10% Long / 20% Short / 70% Cash

Chart for SPX: