• 46661fe25c3afd44d052377e.png (600×625)

Economic Reports Due out (Times are EST): ICSC-Goldman Store Sales (7:45am), Redbook (8:55am), ISM Manufacturing Index (10am), Construction Spending (10am) 

Premarket Update (Updated 8:00am eastern):

  • US futures are flat ahead of the bell. 
  • Asian markets traded down about -1.8%.
  • European markets are closed.

Technical Outlook (S&P):

  • A mild sell-off yesterday after four straight days higher in the market. 
  • It’s a new month, and so far this year, the first trading day of each month has brought on a decent/strong market rally. Let’s see if the trend continues today. 
  • Pullback yesterday, did not pose any technical damage to the charts for the bullish breakout of the 1392/1357 range. 
  • S&P is well overbought at the juncture, and a few more days of consolidation would be a good thing for the market. 
  • 30-minute chart shows a healthy double bottom in place in the S&P. 
  • The market’s whip-saw action of late has created a convergence of moving averages (10, 20 & 50 DMA’s). 
  • Not until we jet back and above 1422 will this market have resumed the rally back off of the October lows. Despite leaning bullish towards this market now, there still remains the possibility of the market forming a lower low between current price and 1422. 
  • Friday’s continuation rally changed the character of the market to bullish by breaking out of the range the S&P had been trading in. 
  • Now the bulls need to make sure that any weakness that may come their way doesn’t cause them to fall back below 1392. 
  • The previous trend-line off of the October lows has become resistance for price action on the underside. 
  • On the weekly chart, we confirmed the bearish wedge pattern that we had been following for weeks. Very bearish development for the market. 

My Opinions & Trades:

  • I remain bullish in the short-term after witnessing the market breaking out of the 1392/1357 range last week. 
  • Covered AMKR yesterday at $5.20 from $5.54 for a 6.1% gain. Day-traded SIMO for a -2.7% loss. 
  • Sold LIZ for a 1.8% gain.
  • Bought HBAN at $6.66.
  • Remain long in CLX at $70.19 and GCA at $8.51.

Chart:

46661fe25c3afd44d052377e.png (600×625)

You Might Like

  • The rise of the retail trader in the stock market.

    The Retail Trading Revolution: How Small Investors Are Reshaping the Stock Market

  • fading the gap

    Fading the Gap: How Large Overnight Moves in SPY and QQQ Play Out During the Trading Day

  • how to trade a bear flag

    How to Trade a Bear Flag