Pre-market update:

• European markets are 1.3% higher. 
• Asian markets traded 0.2% lower.
• US futures are trading moderately higher.  

Economic reports due out (all times are eastern): ICSC-Goldman Store Sales (7:45am), Durable Goods Orders (8:30am), FHFA House Price Index (9am), S&P Case-Shiller HPI (9am), New Home Sales 10am), Consumer Confidence (10am), Richmond Fed Manufacturing Index (10am), State Street Investor Confidence Index (10am)

Technical Outlook (SPX):

• The third large-scale pullback in the last four days, yesterday. 
• Some signs yesterday, different from the days prior, that shows the market may be putting in at the least, a short-term bottom that will allow for a a dead-cat bounce. 
• Lots of Volume continues to pour in over the last three trading sessions. 
• Closed for the third straight day below the lower Bollinger Band. However, unlike trading above the upper Bollinger Band, the market can trade for extended periods in very bearish sell-offs, well below the lower band. See 2008, 2009, and Summer of 2011 for reference. 
• Bounces in this situation can be extreme, because the the squeeze on short positions, and the urgency to capture profits from the big gains made over the previous trading sessions. 
• As a result it often times leads to a mass exodus of bears trying to cover their positions all at once.
• We are oversold short-term. 
• Recapturing 1601 would be a step in the right direction for the bulls. 
• 1608 would make a lot of sense in terms of a market bounce to previous resistance. At that point, I would look for new opportunities for shorting stocks. 
• We’ve established a downward channel that can be seen below that I believe, if it can hold, should warrant a short-term bounce at these levels. 
• The same thing that pushed the market up over the last four and a half years, the absence of it will lead the market right back down. That is what we are seeing as a result of the Fed’s tapering talks. 
• This kind of volatility hasn’t been seen since the summer of 2011. 
• As a result of that, we have now established a lower-high and lower low for the first time in this market for 2013. 
• Any bounce higher at this juncture should be considered a dead cat bounce. 
• With recent selling, we are now trading well below the 10,20, and 50-day moving averages. 
• VIX  recaptured the 20’s. 
• The S&P 500 is on the verge of having its first down month of 2013. 
• 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 AMZN at 268.98 for a 1.5% loss. 
• Added PCYC long at 80.56. 
• Added WLP long at 80
• If the market can bounce here, I may look to add some long exposure for a brief period. 
• Join me each day for all my real-time trades and alerts in the SharePlanner Splash Zone

Chart for SPX: