Today’s Trading Plan: Sell-Offs and Bounces

Technical Outlook:

• Strong sell off yesterday puts this market at the edge of pearl going into today.
• Yet again after a sell-off we are looking at another gap up for the market today. Previous hard sell-offs saw immediate rallies the following day. 
• SPX once again broke below the rising trend-line off of the October lows. 
• Watch the price action during the first 30 minutes of trading before making any changes in the portfolio as you will want to see first how strong the actual move in the market is going to be. A gap fill would be bearish. 
• Bears needs to push this market below the lows of last Thursday at 2077, followed by a push below 2040. 
• SPY volume was above average and better than what we saw the previous two days of buying. 
• VIX rose 11.4% to 14.31. 
• T2108 (% of stocks trading above the 40-day moving average) had a significant sell-off of 15% down to 44%. The chart is breaking down and looks highly negative. 
• 30 minute chart of $SPX looks an absolute mess, although there is a potential head and shoulders forming since the 20th of April. 
• For the bulls, to regain favor with this market, a push above 2120 becomes absolutely necessary. 
• The market chop since mid-February continues to persist and get even tighter as the weeks pass by. 
• 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 short position yesterday. 
• Closed out INTC yesterday at 32.80 for a 0.3% loss. 
• 10% long / 10% short / 80% cash. 
• Remain long: ACN at 94.78
• I’ll consider adding 1-2 new positions today.
• Join me each day for all my real-time trades and alerts in the SharePlanner Splash Zone

Chart for SPX: