Today’s Trading Plan: Putting in a Short-Term Bottom

Technical Outlook:

• Huge bounce on S&P 500 (SPX) yesterday that put in a strong case for a short-term bottom being formed at 2120. 
• The rally yesterday took price back above the 5-day moving average which is something the index has been unable to do over the past week.
• SPY volume increased yesterday from the day prior and remains well above recent averages. 
• The price action around the 2120 level and yesterday’s bounce that we saw, reminds me a lot of the bounces we saw at the 2040 level back in April and May, and all throughout 2015. 
• Because of the rally in Apple (AAPL), the Nasdaq (QQQ) finds itself in a very favorable situation. It has bounced substantially off of the 50-day moving averages and on through the 5, 10 and 20-day MA’s as well. This is by far the strongest of all the indices right now and allowing the market to stave off another sell-off attempt. 
• The market is choppy, you have to go with the ebbs and flows of it – I don’t recommend being heavily long or short at this moment. 
• CBOE Market Volatility Index (VIX) took a beating yesterday dropping 10% down to 16.30. But nothing like what we saw on Monday’s rally in equities. 
• This market could still easily reverse back down again, though I think the bears have lost a great deal of momentum here with yesterday’s move. 
• If SPX continues to move higher today, it will find some heavy short-term resistance in the 2160-75 area that it will have to deal with. 
• Crude (/CL) looks to break the September lows and likely move on toward the August lows.

My Trades:

• Sold XYL yesterday at $50.33 for a 2.3% profit. 
• Covered T yesterday at $40.22 for a 1% profit. 
• Sold SPXU yesterday at $24.13 (flat trade)
• Covered GOOGL at $802.05 for a 1.5% loss. 
• Added 3 new swing trades to the portfolio yesterday. 
• Remain short: TGT at $70.30
• May add 1-2 new swing-trades to the portfolio today. 
• Currently 30% Long / 10% Short / 60% Cash
• Join me each day for all my real-time trades and alerts in the SharePlanner Splash Zone

Chart for SPX: