Pre-market update:

• Asian markets traded flat. 
• European markets are trading 1.5% higher.
  
• US futures are trading 0.6% higher ahead of the market open. 
  

Economic reports due out (all times are eastern): MBA Purchase Applications (7), ADP Employment Report (8:15), Treasury Refunding Announcement (8:30), PMI Services Index (9:45), ISM Non-Manufacturing Index (10), EIA Petroleum Status Report (10:30)

Technical Outlook (SPX):

• Yesterday SPY attempted to fill the gap from the Friday move. It didn’t quite fill it all the way, but the extent of the move was adequate enough. I’m not marking that as a gap that still needs to be filled going forward. 
• The 5-day moving average continues to be a strong reading of where this market is heading. SPX tested it yesterday and held the MA into the close. 
• Volume over the last two days have been light, indicating that the two days of selling should only be considered a light volume pullback. 
• Also, the trend line off of the 10/15 lows needs to “flatten” out a bit – no rally can sustain a trend that is in excess of a 45 degree angle. 
• SPX 30 minute chart remains healthy with a series of higher highs and higher lows. 
• VIX hardly finished higher – up 1.1% to 14.89.
• Ideally some consolidation going forward would be great for the bulls and would provide some prime long setups for the next leg higher. 
• The only argument the bears might have at this juncture of the market rally would be if a wave of selling suddenly hit the market and created a double top scenario on SPX. 
• SPX is no doubt overbought at this juncture of the rally, but those types of conditions can go on far longer than one would ever think. 
• Market internal indicators all continue to look fairly healthy at this stage of the game. 
• 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 additional position yesterday. 
• Sold WYNN at 184.35 for a 2% loss. 
• Will consider adding 1-2 new long positions today.
• Remain long INFY at 62.56, MS at 34.40, NFLX at 388.28, LUV at 11.3, PHM at 19.35.
• 60% long / 40% cash. 
• Join me each day for all my real-time trades and alerts in the SharePlanner Splash Zone

Chart for SPX: