Trading Plan for June 1, 2011

Current Long Positions (stop-losses in parentheses): BBBY (53.04), DO (71.97), SLV June $35 Puts

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

BIAS: 20% Long

Economic Reports Due Out (Times are EST): MBA Purchase Applications, Challenger Job-Cut Report (7:30am), ICSC-Goldman Store Sales (7:45am), ADP Employment Report (8:15am), Redbook (8:55am), ISM Manufacturing Index (10am), Construction Spending (10am)

My Observations and What to Expect:

• Futures are showing mild weakness prior to the open. 
• Asia was flat in their trading, while Europe is down on average about 0.5%. 
• Huge day for the bulls yesterday as the indices were up on average 1%. 
• Of note yesterday, was the huge spike in volume, and the breakout of the downward channel we had been stuck in for about a month.
• We also broke above the 20-day moving average which had been problematic of late. 
• More likely than not, we’ll see a challenge of recent recovery highs established back on 5/2. 
• A close above 1347, would incite bullish enthusiasm going forward, representing a break of the previous short-term lower-high.
• My conclusion: Though we may see some profit taking in the coming days, a strong possibility exists that we will begin a new leg up in this market. 

Here Are The Actions I Will Be Taking:

• Added BBBY at 49.02, DO at $44.64, and June SLV $35 Puts. 
• Closed out a 20% position in SSO for a 1% intraday gain yesterday. Closed out in afterhours ARR at $7.40 for a 4% loss after the company priced 16m additional shares at $7.40 (which essentially solidifies my hatred for trading REIT’s).
• Will look to add 2-3 new positions to the portfolio
• I will not hesitate to book profits today in SLV Puts if they are there. 
• Follow me in the SharePlanner Chat-Room today for all my live trades and ideas (as well as everyone else’s).