Pre-market update:

• Asian markets traded -1.7% lower.
• European markets are trading 0.1% lower. 
• US futures are trading 0.2% higher ahead of the market open. 
  

Economic reports due out (all times are eastern): Treasury Budget (2)

Technical Outlook (SPX):

• Heavy sell-off yesterday took us below the 10-day and 20-day moving averages in one fell swoop. 
• The short-term key price level of 1823 was broken decisively yesterday as well, which gives much more legitimacy to the bears at this juncture and warrants consideration of adding new short positions to the portfolio. 
• Two key support levels to watch today as well, and that carries more significance is 1813  which is the rising support/trend-line off of the October lows. Second is 1809 which is key price level support that needs to be held. 
• With the break of 1823, SPX effectively created a lower-low on the charts – though I wouldn’t consider it a significant one. 
• Volume was slightly above average yesterday. 
• VIX spiked 9.4% to 13.28. 
• The inverse head and shoulders pattern on the SPX 30-minute chart is null and void. 
• Also of significance the consolidation area that the market had been trading in of late has now been broken too. 
• January is starting off in much the same way as December 2013 did – so keep that in mind. 
• Markets don’t care about the economy nor earnings. 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 CX at 12.32 for a 4.4% gain. 
• Sold CAT at 90.06 for a 1.0% gain. 
• Sold UA at 85.21 for a 2.5% loss. 
• Sold JCI at $51.27 for a 0.5% loss. 
• Did not add any new positions yesterday. 
• Remain long AIG at 51.54
• I will look to add 1-2 new positions today. 
• Long 10% / Cash 90% 
• Join me each day for all my real-time trades and alerts in the SharePlanner Splash Zone

Chart for SPX: