• bearish market and sell-off

bearish market and sell-off

Technical Outlook:

  • Market dropped hard on Friday following the NFP/Employment numbers that were released. 
  • Bear flag pattern confirmed on Friday and looking for a bigger move this week towards the 1812 level. 
  • SPY volume was above average on Friday and higher than what was seen the day prior. 
  • Another real possibility of happening this week is the head and shoulders pattern that has been forming over almost two years on SPX confirming around the 1832 level. 
  • On the 30 minute chart there is a significant head and shoulders pattern that should confirm at the market open on the 30 minute chart. 
  • Three separate but significant time frames have three major bearish trading patterns: Intraday (H&S), Daily (Bear Flag), Weekly (H&S). 
  • SPX lost support provided by the 10 and 20-day moving averages on Friday. 
  • VIX saw only a modest 7% spike on Friday rising to 23.38. 
  • T2108 (% of stocks trading above their 40-day moving average) dropped only 14.8% down to 26.84.
  • Neither of these indicators suggest that there was a lot of panic in the selling on Friday. 
  • For the bulls, the key today will be to rally right away and into the gap being established today. 
  • For the  bears, the key will be to push lower and to push the market at least 2% lower today, to form a strong candle.
  • Insane price movements every day being created by computer generated trading (HFT’s) in a highly volatile market marked with enormous headline risk. 
  • There is a lot of stop-loss hunting out there in the market, and being agile with getting in and out of positions quickly has been extremely important. 

My Trades:

  • Added one new short position to the portfolio on Friday. 
  • Did not close out any swing positions on Friday.  
  • Currently 30% Short, 70% Cash
  • Remain Long (UltraShort ETF) SPXS at 19.71.
  • Remain short two other positions. 
  • Market is starting to weaken significantly again, and looking to add 1-2 new short positions today. 
  • Join me each day for all my real-time trades and alerts in the SharePlanner Splash Zone

Chart for SPX:

SP 500 Market Analysis 2-8-16

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