Today’s Trading Plan: Remaining Vulnerable

Technical Outlook:

• A respectable rally yesterday that saw price break above the 5, 10, 20, and 50-day moving averages that have all converged together at one specific price point. 
• SPX & SPY volume saw a considerable pick up yesterday off of the rally. 
• The key for the bulls today will be to push the price above Last week’s highs. If it does that, there is a much more legitimate chance that this market is carving out a possible new uptrend. 
• Still, for the bears, the objective remains to get SPX below 2040 to confirm the double top on the charts. 
• The convergence of the 5, 10, 20, and 50-day moving averages is a perfect example of how non-directional this market has been over the course of this year. 
• VIX only rallied a 1/2 percent to 14.74. 
• Big day out of T2108 (% of stocks trading above the 40-day moving average) as it moved 13% to 60%. 
• The trading range continues to get even more narrow, with last week establishing a new lower-high and a higher-low. 
• You still have the lingering potential double top on the 30 minute chart of SPX but overall the price action there is very uncertain and choppy.
• Plenty of uncertainty remains in the market short-term. Euro and oil are major players in the market’s direction currently.
• Oil remains extremely volatile and becoming more so each and every day. Very difficult to trade – as are the oil stocks. 
• 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:

• Added one new position on Monday. 
• Closed out GCI yesterday at 36.29 for a 1.2% loss. 
• 20% long / 80% cash. 
• I’ll consider adding 1-2 new long positions today dependent on the strength of today’s price action. 
• Remain long: UPRO at 132.12
• Join me each day for all my real-time trades and alerts in the SharePlanner Splash Zone

Chart for SPX: