Current Long Positions (stop-losses in parentheses): TICC (8.51)

Current Short Positions (stop-losses in parentheses): SPY (108.68), DGX (47.10), FCN (35.01), URBN (32.73), OMI (27.76), HSY (48.02), ADBE (29.78), DDS (22.78)

BIAS: 52% Short

Economic Reports Due Out (Times are EST): Personal Income and Outlays (8:30am)

My Observations and What to Expect:

  • Futures are just slightly positive, despite being up almost 1% early on. Continuous selling since.
  • Big Report this week will be the employment number on Friday.
  • Worst case for the bulls today, would be if they gave up Friday’s gains. Would inevitably lead to much more selling in the days ahead.
  • Worst near-term scenario for the bears if they give up 1100 on the S&P. Hardly likely to happen today though.
  • Closest Resistance level is at 1067. Should be difficult for the bulls to close above it.
  • 50-day moving average is an additional resistance level for the bulls as well.
  • Personal Income and Outlays report this morning should have a moderate impact on the markets early on.

Actions I Will Be Taking:

  • Portfolio is not hedged at all this morning.
  • Should follow-through from Friday’s rally occur, I will look to put a new hedge position on with SSO during an intra-day pullback.
  • Possible that I may add one additional position to the portfolio to get closer to 60% vested to short side.
  • Sold HSY at the Friday close for a small profit. M&A chatter was picking up.
  • If there is a sizable gap-up, may make for a high probability fill considering market behavior this morning.
  • If today is a trendless day, I will focus on scalping trades, using fading techniques against market extremes.
  • Lowered stop-loss on URBN to $32.73 to lock in additional profits.
  • I will use ETF’s, in particular 3x ultras, to fade market extremes today, if we are in a trendless market today, to scalp for intra-day profits.