Today’s Trading Plan: Bounce or Continuation

Technical Outlook:

• Heavy sell-off yesterday completely changed the nature of the market. 
• SPX broke back down and below key support at 2120, which now becomes resistance again. 
• The breakout above the 2120 resistance level two weeks ago is now labeled a ‘head-fake’. 
• The trend-line off of the February lows was broken yesterday, and today the key trend-line to watch is the one off of the March lows at 2078. 
• There is obviously the potential for a bounce today, but I would be careful with piling up any significant amount of long positions today, as it could very easily turn into a dead cat bounce and the market resumes its selling to the downside. 
• Oil showing signs of breaking down again and could weigh heavily on price action of the broader market as well. 
• VIX popped 16% yesterday – all the way up to 14.06 
• The most mesmerizing chart of the day came from the T2108 (% of stocks trading above the 40-day moving average) where it saw a 22% drop all the way down to 39%
• SPX 30 minute chart doesn’t reveal much to glean from as it just continues to be mired in choppiness of late. 
• Volume on SPY was notably stronger then anything we have seen in the past few weeks and well above average too. 
• We still have a higher-high in place currently with SPX, and would need to break 2067 in order to form a new lower-low. 
• The market doesn’t care about the economy nor earnings. That is not what is driving it. The market only cares about what the Fed is doing to keep equities propped up. 

My Trades:

• I did not add any new trades yesterday. 
• Closed out AAPL at 130.58 for a 1.7% gain. 
• Closed out FB at 79.44 for a 1.9% loss. 
• Closed out MHFI at 104.69 for a 2.5% loss. 
• 10% short / 90% cash. 
• Remain long: SDS at 19.90.
• I’ll consider adding 1-2 new depending on the direction and strength of the market. 
• Join me each day for all my real-time trades and alerts in the SharePlanner Splash Zone

Chart for SPX: