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

Current Short Positions (stop-losses in parentheses): ESV (42.84), MR (32.34), WTFC (37.71), SLAB (44.80), CERN (83.20), ALB (43.59), HIBB (26.65),  WRC (40.95)

BIAS: 89% Short

Economic Reports Due Out (Times are EST): Housing Market Index (10am)

My Observations and What to Expect:

  • No major economic reports due out today that would single-handedly shift/influence market sentiment.
  • Futures up moderately prior to open.
  • With no news, morning bullishness is a fade-worthy trade on gap-up
  • Friday’s sell-off engulfed six previous trading sessions = bearish
  • Still overbought on S&P and other indices. 
  • Volume on Friday was higher than all previous 9 trading sessions.
  • Previous higher volume day occurred on key reversal day that occurred on 7/1/10
  • Series of previous lower-highs in place…perfectly.
  • If series of 9 day market reversal pattern remains intact, we could be on only day 2 of 9 selling days.
  • Earnings should be main market driver this week with big names reporting.

Actions I Will Be Taking:

  • Look to add one more position to my portfolio if the market doesn’t sell-off right away. Preferably an index fund, maybe even a 2x.
  • Will look to hedge portfolio with an ultralong if the market gets suddenly bullish and bounces through significant intraday resistance levels.
  • May scalp a trade to the short side if the opportunity presents itself.