Today’s Trading Plan: Employment Hits Hard

Technical Outlook:

• Dip buyers stage a nice 23 point rally off of the lows yesterday to finish the day slightly in the green. 
• Employment number will play a significant role in the direction the market takes today. The report represented a significant miss and an immediate sell-off thereafter.  
• SPY volume fell off some and was also slightly below average. 
• VIX dropped 8% yesterday to close at 22.55. 
• The huge miss in the employment report likely insures that there won’t be a rate hike in October. 
• Defending the Tuesday lows are absolutely key for this market today. A break of those levels would restart the sell-off. 
• At the close yesterday, SPX looked poised to make a run for 1950 area. But with the futures taking a hit, that seems unlikely anytime soon. 
• 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 big key for the market will be getting back above and closing above the 1997 level. Then there is a confirmed double bottom in place. 
• 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:

• Added one new long position to the portfolio yesterday. 
• Did not close out any swing-trades yesterday. 
• 20% Long / 80% Cash
• Remain long: SSO at 55.07
• 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: