Today’s Trading Plan: Tight Trading Range Persists

Technical Outlook:

• Extremely dull price action has a grip on the market right now. That should change tomorrow when the Fed’s FOMC Statement comes out. 
• For the better part of two weeks the major indices have traded sideways. 
• SPX had a real chance for a breakdown yesterday and instead, it rallied  hard into the close, erasing over half of the day’s losses. 
• Apple (AAPL) reports earnings after the close and its impact will be felt across the board. 
• The tight trading range over the last two weeks signifies that the market isn’t necessarily in the business of pulling back as much as it is into correcting through time. 
• 10-day moving average tested and held yesterday for a third straight day. 
• Oil continues to fall hard. USO for instance is looking at an open below the 50% retracement level off of its February lows. That would be significant. 
• If the slide continues, in the very near future, stocks will start reacting adversely to it. 
• VIX saw a hard spike higher into the upper 13’s yesterday, but gave back half of its gains to close back below the critical 13 level. 
• Since the 20th of July the 30-minute chart of SPX has been extremely choppy with strong moves in both directions without any sustainability. 
• Tomorrow is FOMC day – volume will be likely light. 
• Tons of earnings reports this week and next. This week will see weakness creep back in to the market if big names disappoint. 
• The market is climbing the wall of worry, and despite what we might think or the overall economy, central banks are providing accommodating policy which will make a major sell-off difficult, particularly when the Fed seems unwilling to raise interest rates any time soon. 
• Fed will be releasing its FOMC Statement at 2pm eastern on Wednesday. No press conference is scheduled. 
• Watch 2155 on SPX – a break of this price level could lead to further selling today. 
• At this point, and with the election ahead, I’d expect the market to keep rallying higher. I don’t expect there to be a rate hike between now and the election. To do so would impact the market and thereby the election. I don’t think the Fed wants that, particularly since Trump has indicated that he would replace Yellen. 
• Market is assuming that rate hikes are pretty much off the table for all of 2016. 

My Trades:

• Sold AKAM yesterday at $57.93 for a 0.6% profit. 
• Did not add any new positions to the portfolio yesterday.  
• May add 1-2 new swing-trades to the portfolio today. 
• Will be closing a number of positions out this week ahead of their earnings report. 
• Will consider hedging the portfolio as well with a short position. 
• Currently 50% Long / 50% Cash
• Join me each day for all my real-time trades and alerts in the SharePlanner Splash Zone

Chart for SPX: