• SP 500 Market Analysis 10-6-15a

Technical Outlook:

  • SPX rally has now spanned 116 points off of the 9/29 lows and 106 points off of the 9/28 closing lows. 
  • Shorts have been forced to cover their positions in a very aggressive manner of late, fueling much of the rally seen of late. 
  • The downtrend off of the 8/18 highs was broken yesterday. 
  • Some profit taking today wouldn’t be overly surprising after having rallied five straight days. 
  • The current five day rally is the longest so far of 2015. 
  • If SPX manages to rally and close above the 1997 resistance level, it would confirm the double bottom pattern on the daily chart
  • SPY volume came in weak and less than the current market average. 
  • SPX stands to test the 50-day moving average, which currently rests at 2000. 
  • VIX finally starting to break down after dropping 6.7% to 19.54 and is now below 20 for the first time since 8/20/15.
  • T2108 (% of stocks trading above their 40-day moving average) soared yesterday 63% to close at its highest level since 6/24/15.
  • The notable strength in this indicator suggests that a bottom could very well be in place for SPX for the year.
  • Resistance on the SPX 30-minute chart approaching between 1989 and 1993. 
  • After trading lower for two straight quarters (a rarity that hasn’t been seen since 2011), I wouldn’t be surprised to see quarter four turn out to be very bullish for the market. 
  • The Fed has never raised interest rates at a point where the market was trading lower on the year. 
  • The large gaps in the market, the record number of stock buybacks, and ETFs that are constantly accumulating/dumping large chunks of stocks, and most importantly the high frequency trading, shows just how illiquid this market has become in recent years. These entities are the most responsible for the massive market swings that stocks incur each day. 


My Trades:

  • Sold SSO yesterday at $59.55 for a 8.1% gain. 
  • Sold HRB yesterday at $36.09 for a 0.3% loss. 
  • Added two new swing-trades yesterday. 
  • 40% Long / 60% Cash
  • Remain long: EL at $80.52, MSFT at $45.13.
  • Will continue to play this market long while the market bounce persists. 
  • Join me each day for all my real-time trades and alerts in the SharePlanner Splash Zone

Chart for SPX:

SP 500 Market Analysis 10-6-15a

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