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

Current Short Positions (stop-losses in parentheses): SPY (131.35)

BIAS: 45% Short

Economic Reports Due Out (Times are EST): MBA Purchase Applications (7am), New Home Sales (10am), EIA Petroleum Status (10:30am)

My Observations and What to Expect:

  • Futures are slightly negative heading into the open. 
  • Asian markets are mixed ranging from -1.7% up to 1%, while European markets are all trading slightly flat. 
  • The S&P continues to struggle in getting past significant milestones, namely the 20 and 50 day moving averages and also the 1300 mark. 
  • Volume was noticeably weak yesterday and the market is entering into short-term overbought territory. 
  • End of quarter action could provide for some interesting dynamics in the market over the course of the next week or so. 
  • S&P also struggling with the 10-week moving average on the weekly charts which was previously a major support level off of the September lows. 
  • Remember we are in a  confirmed downtrend. You cannot be as trusting of market dips as being a ‘buying opportunity’ – instead, as traders you have to reverse course and sell-the-rips. 
  • If we see a market sell-off today, one important price level will be the 100-day MA at 1265, which is the same MA we recently bounced off of when we sold off significantly. 
  • A break of the descending trend-line would occur at 1312 on the S&P.
  • Trades, whether long or short, should be held for a much shorter period of time. Market volatility can quickly erase gains.
  • My conclusion: If this market is going to continue its bearish ways, it will need to sell off here real soon and build off of yesterday’s slight decline.

Here Are The Actions I Will Be Taking:

  • Sold NVDA yesterday for a +2% gain, and SKS for a 1.9% gain – both were short positions.
  • Should the market surge higher, today, I will add once more to my SPY position.
  • I don’t expect to take on any new long positions today.
  • Should we see some weakness, I will use it to add additional short positions to the portfolio. 
  • Follow me in the SharePlanner Chat-Room today for all my live trades and ideas.

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