Technical Outlook:
- Strong start yesterday on S&P 500 (SPX) but simply could not hold on as the afternoon unfolded as it gave up some of its gains heading into the close.
- No ramp into the close yesterday which has become a staple for bullish traders.
- The market is alternating again in an up/down/up/down fashion. A close lower today would market day #8. Last month we made it to 11 straight days.
- SPX has not seen a +/- 1% move in either direction since July 8, 2016. Since then the market has moved higher but in very small increments and tight daily ranges.
- Futures are a bit weak this morning. Watch the 20-day moving average if the market sees any substantial selling.
- Additional support levels to watch include 2071 and 2055, a break of either would not be healthy for this market.
- CBOE Volatility Index (VIX) continues to show very little price movement in recent days. It is still trading below 12.
- Volume on SPDRs S&P 500 (SPY) was incredibly weak yesterday and dropped for a second straight day, which also helps explain the afternoon doldrums during trading yesterday.
- Nice setup of higher highs and higher lows on SPX 30 minute chart of late.
- Oil continues to trade higher and looks to extend its gains today. Don’t try to short this rally. Oil continues to trade with an all or nothing mentality.
- Dow Jones Industrial Average (DJIA) broke through resistance yesterday and needs follow through to day to put to rest any talk about a possible double top pattern.
- The bulk of the earnings season is behind us. No significant disasters from the big names that reported that negatively impacted the market as a whole.
- Overall, August is the worst performing month for the Dow and S&P 500.
- 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.
My Trades:
- Sold IP yesterday at $46.39 from $45.51 for a 2.0% profit.
- May add 1-2 new swing-trades to the portfolio today.
- 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:
