Trading Plan for March 11, 2011

Current Long Positions (stop-losses in parentheses): TICC, PGH (12.65), LIZ (5.33), IRC (9.23), KEY (9.08), MPEL (7.11), AAPL (338.23), FFIV (105.10)

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

BIAS: 48% Long

Economic Reports Due Out (Times are EST): Retail Sales (8:30am), Consumer Sentiment (9:55am), Business Inventories (10am)

My Observations and What to Expect:

• Futures are slightly down but well off their overnight lows.
• Asian markets traded lower in excess of 1% on average while Europe is seeing losses range from -0.2% to 1%.
• S&P is at the cusp of ending the rally from 9/1 and beginning a new downtrend, if it manages to break the lows from 2/24.
• The 50-day MA on the S&P was broken yesterday, as the bulls failed to get a substantial bounce in price off of that significant support level.
• Should we see a move below 1294 and close below that level, we will then enter a stage of the market where market rallies should be used as opportunities to go short.
• Volume was very high yesterday, and declining issues was extremely negative.
• The next level of support for the S&P lies at 1275.
• A break of S&P 1294 (last week’s lows) would put in a lower-low in the markets, and confirm a downtrend being in place.
• For the bears – Closing below 1294 is a MUST today.
• For the bulls – Hold  1294, and regain the 50-day moving average for support.
• My conclusion: With yesterday’s sell-off, market direction is becoming much more clearer, where longs need to be looking to exit their positions and protect their capital.

Here Are The Actions I Will Be Taking:

• Stopped out of KEY and PGH for losses yesterday.
• Added AAPL and FFIV yesterday.
• Slightly adjusted the stop-loss in LIZ to 5.33.
• Will begin to use today to start closing out long positions. Very unlikely I’ll be adding any new ones, unless it comes on a substantial market bounce.
• Follow me in the SharePlanner Chat-Room today for all my live trades and ideas.