Current Short Positions (stop-losses in parentheses): SBUX (31.37)
BIAS: 4% Short (-20% short considering the leverage in QID)
Economic Reports Due Out (Times are EST): None
My Observations and What to Expect:
- Futures are showing some weakness
- Asian markets were up about 1%, while European markets are trading with a slight negative bias.
- Today sets up as an excellent pullback opportunity. Wait for the market to give back some gains here before jumping into anything on the long-side.
- With the upside break through of the 200-WEEK moving average, history suggests that this leads to a major rally in the markets.
- Next level of resistance for the bulls is 1275 on the S&P.
- Initial support for the S&P on a pull-back lies at the April highs which is 1219 or six points below where it is currently trading.
- Absolutely no reason to be short except for the very near-term that indicates the market needs a small pullback before advancing any further. Any significant position building to the short side is a reckless use of portfolio capital.
- No scheduled news releases due out today that could impact the market.
- Wait for some weakness in this market before adding new long-positions, don’t try to chase after this market at all.
- For the bears look for a a gap open that is below Friday’s lows with further selling thereafter, which would be ideal, and at the least, some selling today that begins to erase Thursday’s gains.
Actions I Will Be Taking:
- Added one new short position to the portfolio on Friday – SBUX, which looks to have made an exhaustion gap-up on Friday.
- Will look to sell QID and cover SBUX today on market weakness.
- Will add 1-2 new long positions to the portfolio on any decent amount of market weakness.
- Follow me in the SharePlanner Chat-Room today for all my live trades, including my day-trades.
