Pre-market update (updated 8:30am eastern):

  • European markets are trading mixed/flat. 
  • Asian markets finished 0.3% higher. 
  • US futures are slightly higher ahead of the bell. 

Economic reports due out (all times are eastern): MBA Purchase Applications (7am), GDP (8:30am), Corporate Profits (8:30am), Pending Home Sales Index (10am), EIA Petroleum Status Report (10:30am), Beige Book (2pm)

Technical Outlook (SPX):

  • Another day of consolidation for the markets, like we’ve seen over the past few days. 
  • No apparent strong-handedness by the bears despite the opportunity being there for the taking. 
  • One could make the argument that the price action since breaking the 1422 highs intraday, has been the result of a bull-flag on the daily. 
  • 30-min chart on SPX shows a well established bullish trend over the past month. Action since 8/21 has the potential for a new channel downward possibly forming. 
  • If we sell-off again today, watch the 20-day moving average to act as a possible support level for the market, in which bulls try to buy the dip at. 
  • 10-day moving average has been rather useless of late, largely going ignored by the indices. 
  • Going forward SPX needs to close above 1422 and take out 1426 recent intraday highs.
  • Volume remains at ridiculously low levels – Monday was no better. 
  • We are well-off of overbought levels – which gives this market plenty of room to run. 
  • SharePlanner Reversal Indicator received a bullish confirmation signal. 
  • VIX continues to climb – up 6 out of the last 7 days and at +16.
  • One area of concern is the 3 large gaps off of the 6/4 lows that remain unfilled, including 6/6, 7/26, 8/3
  • If another sell-off were to ensue, watch for a break and close below 1354 for a new lower-low in the market.  

My Opinions & Trades:

  • No new positions for me yesterday.
  • Closed RNDY yesterday at 7.70 from $7.86 for a -2% loss
  • Any new long positions will likely result in me closing out an existing long position. 
  • Current stop-losses have been adjusted across the board. 
  • Stop-loss in AMZN moved up to $241.00.
  • HE Short stop-loss has been has been tightened to 27.40. 
  • ALXN stop-loss moved up to $100.98
  • Remain long RHT at $57.56, CRM at $145.39, FBHS at $24.54, ALXN at $102.53, LXP at $9.21, and AMZN at $233.90. Short HE at $28.45.
  • Track my portfolio RealTime here. 


SP 500 Market Analysis 8-29-12