Pre-market update:

• Asian markets traded 0.2% higher. 
• European markets are trading 0.3% higher. 
• US futures are trading 0.2% lower. 

Economic reports due out (all times are eastern): Wholesale Trade (10)

Technical Outlook (SPX):

• Somewhat of a rebound for the markets yesterday. 
• Closed the opening gap up and then made its ultimate move to the upside – we haven’t seen this type of trading pattern in a while. 
• Typically gap closures has resulted in a bigger reversal from the direction the market originally opened at. 
• This market action is nearly identical to the action we saw from 3/6 through 4/8. That pattern ultimately led to a move higher in the market, though it was rocky at times. 
• There is a nice short-term and slightly rising support level that has formed off of the 7/16 closing price  and through yesterday. 
• Current support for it is at 1693, which is where the market needs to close above today. 
• Noticeable pickup in volume yesterday. 
• VIX back down to 12.73.
• There is a concerning head and shoulders pattern forming on the 30-minute chart.
• Shooting stars on the VIX indicator has recently been a great indicator of a potential rally in the coming days. We saw that occur on Wednesday. 
• Of importance is the 1676-1685 area. A healthy market won’t creep below 1685. However, a complete shift in the market would take place if SPX were to close below 1676. 
• There is little, and I mean almost no reason to be short this market right now. None. Not with the Fed’s policy or until that changes. 
• 1676 is a very key level for this market in the case of a sell-off. That would create a new lower-low. 
• I remain a buyer in this market. The opportunities to swing short are far too unpredictable, choosing to focus on the long side is the best way to manage risk and maximize profits at this juncture. 
• 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 SJM yesterday at 113.19 for a 8.2% gain.
• Sold COG at 74.98 for a -2.8% loss.  
• Added CAB at 70.38 yesterday. 
• Added PNK at 21.59 yesterday.
• Currently 80% long/20% cash.  
• Current Longs: CMI at 121.60, ASML at 89.63, HRB at 30.19, MU at 13.86, HUM 91.08, CS at 29.91. 
• Join me each day for all my real-time trades and alerts in the SharePlanner Splash Zone

Chart for SPX: