Pre-market update (updated 9am eastern):

• European markets are trading 1.8% lower. 
• Asian markets traded 0.8% lower.
• US futures are down significantly – nearly 1% ahead of the opening bell. 

Economic reports due out (all times are eastern): NFIB Small Business Optimism Index (7:30am), ICSC-Goldman Store Sales (7:45am), Redbook (8:55am), Wholesale Trade (8:55am)

Technical Outlook (SPX):

• Consolidation yesterday ushers in a heavy dose of selling today. 
• SPX traded right up to the 20-day moving average and then failed to break through. 
• With the weakness transpiring in the US markets and the look of what seems nothing more than a dead cat bounce now, the weakness of late in Japan is very much starting to affect our markets and strike fear in it. 
• Also becoming a major concern for the bulls is the notion that banks world wide are going to have to start easing out their centralize planning and propping up of financial markets. 
• Despite all of this, it is still important to remember that the global markets have a lot of difficulty with holding down a significant gap down and tends to lead to a bounce off of the morning lows and a push higher as a result. 
• Watch the VIX this morning to see if it confirms the move in the markets early on. 
• The 30 minute chart on SPX is demonstrating a well defined inverse head and shoulders pattern with confirmation occurring right at the close on Friday. But that may very well get destroyed today. 
• Failure to continue the rally, would result in a significant head fake in the markets, and would cast a heavy dose of bearishness on this market going forward. 
• Key support rests at 1601. 
• Markets don’t care about the economy. That is not what is driving them. The markets only care about what the Fed is doing to keep equities propped up. 

My Opinions & Trades:

• Sold  HLIT at 6.27 for a 3.3% gain. 
• Sold CME at 73.40 for a 4.8% gain. 
• Added KSS at 51.99 (long)
• Shorted LEG at 31.84. 
• Will tighten my stops this morning. 
• May add additional shorts to the portfolio this morning. 
• Long HUM at $80.60, CF at $191.35, APA at $84.95, 
• Join me each day for all my real-time trades and alerts in the SharePlanner Splash Zone

Chart for SPX: