Trading Plan for Dec. 23, 2010

Current Long Positions (stop-losses in parentheses): CX (10.49), AIT (31.49), NTRI (20.98), SNE (35.03), MENT (11.84), AMZN (177.15), F (16.33)

Current Short Positions (stop-losses in parentheses): None

BIAS: 36% Long

Economic Reports Due Out (Times are EST): Durable Goods Orders (8:30am), Personal Income and Outlays (8:30am), Jobless Claims (8:30am), Consumer Sentiment (9:55am), New Home Sales (10am), EIA Natural Gas Report (10:30am)

My Observations and What to Expect:

• Market will be closed tomorrow.
• Futures are are slightly down heading into the open.
• Asian markets were down slightly and European markets are trading mixed.
• Volume will be very light today as it is the last trading day prior to Christmas. 
• The S&P sits right under the resistance area found in the 1260’s while maintaining its current trend line. 
• Should a pullback be in order, a healthy one, would be to the 1246 level on the S&P, where there is some short term support represented by the previous higher-high.
• The Dollar continues to look confused making lower-lows and higher highs, with it currently in the process of doing the latter. This would be considered a divergence in the market, that I’ll be paying close attention to. Another 1/2 percent move upwards, could be a problem for stocks. 
• The lows from 12/15 and 12/16 represent, in my opinion, the “higher-lows” in this recent market rally, and a break below them at 1232, would significantly stall this market’s upward progression and potentially invite a new trend to the downside.
• The S&P continues to follow the 10-day moving average higher, which at this point should also be considered a barometer on the health of this current leg-up in the market.
• Below 1227, should we break it, the key support level for the S&P would become 1216 – the lows of previous consolidation.
• For the bears – Push the market back to the 1246 level, and then start chipping away at support. 
• For the bulls – Now that 1247 has been broken, begin pushing price levels to new resistance levels in the 1260’s on the S&P.

Here Are The Actions I Will Be Taking:

• Don’t expect to add new positions to the portfolio today, but will be pointing out numerous setups though.
• I don’t want to be too heavily long over the Christmas and New Year’s holidays – instead I want to focus on current positions with managing and reducing my portfolio exposure.
• Stop losses in NTRI and MENT have been tightened.
• Closed my last 1/2 position in CX at $10.72 for a 7.2% gain. Overall gains on the trade were 7.5%.
• Closed my position in SNE  at $35.46 for a loss of .02/share. 
• Stocks in the portfolio today that I will be watching carefully and may take action on due to potential weakness will be MENT, NTRI and F. 
• Follow me in the SharePlanner Chat-Room today for all my live trades and ideas.