Today’s Trading Plan: Yellen To The Rescue

Technical Outlook:

• SPX sold off yet again yesterday, but managed to find some dip buyers at the end of the hour – namely in the last hour of trading and boost the market back near break-even – recovering about 70% of the losses on the day. 
• Conflict between the SPY and SPX (due to SPY dividends) – but the SPY shows price holding the 50-day moving average while SPX  shows a close right below it. Based on the look and feel of the chart, I would say that right now price is right on the 50-day MA and will need to see how it resolves the issue at the close. 
• Today is Fed Day – FOMC Statement comes out at 2pm eastern followed by a 2:30pm presser. Interest rates are not expected to be increased, but volatility should be found in the price action. 
• The last two FOMC statements have seen solid rallies. The one on 1/27 resulted in a had sell-off. 
• Good chance that the VIX has put in a short-term top as it managed to peak above 22% and give it all back at the close, finishing 2.2% lower at 20.50. 
• SPY volume increased for a fifth straight day and ws well above recent averages. 
• Yesterday marked only the third time this year where the market has seen four days of straight selling on SPX. 
• As a possible brexit approaches, expect the volatility to increase as well. 
• I believe, at this point, profits have to be taken aggressively, and avoid the tendency to let the profits run – the market is in a very choppy range that has mired stock price for the past two years. Unless it breaks out of it and onto new all-time highs, then taking profits aggressively is absolutely important. 

My Trades:

• Added two new swing positions to the portfolio yesterday. 
• Did not close out any positions yesterday. 
• Currently 30% Long / 70% Cash
• Have the flexibility to go either way the market wants to take me today. 
• Join me each day for all my real-time trades and alerts in the SharePlanner Splash Zone

Chart for SPX: