Current Long Positions (stop-losses in parentheses): PEP (70.10), STZ (22.20), EP (17.84), EXPE (24.74), FTR (8.57), CB (64.32), PCLN (502.75)

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

BIAS: 50% Long

Economic Reports Due Out (Times are EST): Jobless Claims (8:30am), Bloomberg Consumer Comfort Index (9:45am), Existing Home Sales (10am), Philadelphia Fed Survey (10am), Leading Indicators (10am), EIA Natural Gas Report (10:30am)

My Observations and What to Expect:

  • Futures are moderately higher heading into the open.
  • Asia was mostly lower (-0.4%), with Hong Kong being the only one up at 0.6%. Europe saw some very strong gains, rallying in excess of 1% across the board.
  • S&P made a strong bounce yesterday, doing much to fix some of the damage done of late, by 1) Closing a smidgen above the 10-day MA, and 2) closing above the important 1340 previous breakout level .
  • The market will face resistance at around 1349 which represents a descending trend-line the market has been unable to break through since its 5/2 highs. A break would positively change the landscape of the market.
  • Watch-out for a break of yesterday’s lows which would also represent a break of the long-term trend-line dating back to September ’10.
  • 3 additional support levels to watch on the S&P: 1324 – 50-day moving average, 1326 – long-term trend-line, 1294 – another major long-term support level.
  • My conclusion: I think a move to 1349-50 is definitely in the cards – and will wait to see if we can break that resistance level before getting more aggressive with my trading.

Here Are The Actions I Will Be Taking:

  • Closed out EXPE yesterday at $26.73 for a 4.5% gain, and sold EP at $18.90 for a 3.7% gain.
  • Added long positions PCLN at $515.51 and CB at $65.35
  • No changes to the stop-losses.
  • Will look to add 1-2 new positions this morning – will probably sell an equal amount if we cannot close above 1349 by the close.
  • I will start tightening the duration of the trades that I make – I’ll look for most of my trades to last 1-2 days at the most, should the recent market weakness persist. .
  • Follow me in the SharePlanner Chat-Room today for all my live trades and ideas (as well as everyone else’s).

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