• SP 500 Market Analysis 5-5-16

Technical Outlook:

  • SPX sold off for the fourth time in the last five days and closed yesterday below the lows from last week. 
  • There was almost a test of the 50-day moving average yesterday but the dip buyers stepped in before that could take place. 
  • Again yesterday afternoon we saw the dip buyers come in during afternoon trading and lift price off of the lows of the day. 
  • In essence the bears are unable to get even one clean, solid sell-off that doesn’t get eventually bought up. 
  • There is plenty of talk about a market rally today, and that is very much possible considering that oil is up quite a bit in overnight trading and futures up slightly as well. 
  • The 30 minute chart of SPX has a solid series of lower-highs and lower-lows in place. 
  • SPY volume was slightly below recent averages and dropped off some from the day prior. 
  • VIX is really struggling to find some momentum here and push through the 16.40 level as it has been rejected at that price point for four straight days. 
  • T2108 (% of stocks trading above their 40-day moving average) continues to deteriorate, dropping another 5.2% down to 62%. As stated yesterday, it has clearly broken out of its recent range. 
  • The objective for the bulls here should be to get price back over 2073, while the bears should be attempting a move to get back below 2040.
  • Historically the May through October time frame is much weaker than the rest of the year.
  • Yellen’s dovish outlook as it pertains to rate hikes has been, in large part, the reason for the massive rally off of the February lows. 

My Trades:

  • Added one new short position yesterday. 
  • Closed out VZ at $50.84 for a 0.3% loss. 
  • Currently 30% Short / 70% Cash
  • Remain Long: SDS at $18.69 (ETF Short)
  • Remain Short: ORCL at $39.74
  • Will look to add 1-2 new short positions today if the market seeks to push lower. Will be aware for the potential of a bounce as well. 
  • Join me each day for all my real-time trades and alerts in the SharePlanner Splash Zone

Chart for SPX:

SP 500 Market Analysis 5-5-16

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