Pre-market update:

• Asian markets traded 0.4% higher.
• European markets are trading 0.6% lower.
  
• US futures are trading 0.4% lower ahead of the market open. 
  

Economic reports due out (all times are eastern): MBA Purchase Applications (7), Quarterly Services Survey (10), EIA Petroleum Status Report (10:30), Treasury Budget (2)

Technical Outlook (SPX):

• SPX showing some weakness at the open this morning after snapping its 4-day winning streak yesterday. 
• Watch the 10-day moving average as that has often been a place where dip buyers has supported the market over the last few years. Today it should at or around 1936. 
• Weakness is much needed, and not necessarily a threat to the overall market health. The most important support level to hold is the 1900, which is highly unlikely to be any threat today. 
• Volume continues to drop off over the past three days of trading. 
• VIX dropped back down again to 10.99. 
• If you are heavily shorting this market, you would be wise to be aggressive with the profit taking. 
• The 10-day moving average hasn’t been breached since 5/21, which was when the rally started. If the 10-day MA breaks, we could see additional weakness come about. 
• A sell-off in the short-term doesn’t threaten the longer-term ability of this market to continue rallying as long as SPX doesn’t lose the 1900 level which is psychologically significant as well as representing the trend-line that formed off of the April lows. 
• To say the least, I am very cautious towards this market in the very short-term. I think the longer-term pattern still pushes higher, but right now we need to see the market cool off some first. 
• If/when the profit taking occurs, I wouldn’t let it alarm you, even if it results in a +20 point pullback on SPX. 
• The market doesn’t care about the economy nor earnings. That is not what is driving it. The market only cares about what the Fed is doing to keep equities propped up. 

My Trades:

• Closed out STT at $66.96 yesterday for a 1.8% gain. 
• Added one additional long position yesterday. 
• Added one new short position yesterday as a hedge against existing longs. 
• I will look to add 1-2 new long positions today. 
• Remain long AKAM at 54.52, HAL at 63.07, IR at 60.11, FB at 63.05.
• 50% Long / 10% Short 40% Cash
• Join me each day for all my real-time trades and alerts in the SharePlanner Splash Zone

Chart for SPX: