Current Long Positions (stop-losses in parentheses): TICC (9.62), BRKR (13.49), CVX (77.93), DAL (11.12), ELY (6.39), ITW (45.47), SSO (38.03), QQQQ (48.06), FRG (6.78) PCX (10.99)

Current Short Positions (stop-losses in parentheses): LMT (76.35)

BIAS: 80% Long

Economic Reports Due Out (Times are EST): Factory Orders (10am), Pending Home Sales (10am)

My Observations and What to Expect:

  • Futures are down moderately..
  • Asian markets are mixed while European markets are with about 1% in losses.
  • 1160 is a key long-term resistance level that needs to be watched (give or take a couple points).
  • We’ve now seen five straight days of consolidation.
  • Best case scenario for the bulls is if we could gap above 1150 tomorrow and push through 1160 at the close.
  • Best case scenario for the bears is for a move back down to 1130.
  • Still wedged up against the upper line of the rising channel. For October to be a success, will need to breakout and close above the upper-line.

Actions I Will Be Taking:

  • May attempt to add ENER at the open tomorrow.
  • Made changes to the stop-losses of four of my positions – BRKR, CVX, DAL, ITW.
  • May tighten LMT tomorrow as well depending on the open.
  • Becoming a bit weary of intraday hedge positions for covering myself if the market goes lower due to the willingness of the bulls to continue buying dips. 
  • Unless the futures move dramatically lower (currently S&P down 5.5 points), this would be a good gap-fade opportunity for traders.