Trading Plan for September 18, 2012

Pre-market update (updated 8:30am eastern):

• European markets are trading -0.7% lower. 
• Asian markets finished mixed on the day. 
• US futures are trading slightly lower ahead of the opening bell. 

Economic reports due out (all times are eastern): ICSC-Goldman Store Sales (7:45am), Current Account (8:30am), Redbook (8:55am), Treasury International Capital (9am), Housing Market Index (10am)

Technical Outlook (SPX):

• Inevitable pullback yesterfday, and shouldn’t be a concern at this point for the bull camp. 
• No sign of panic yesterday during the sell-off. 
• Volume confirmed this by being much lighter than the volume we saw in the run-up. 
• Price action pulledback inside of the upper bollinger-band. 
• Yesterday afternoon, near the close, we saw a surge of buying, that has been indicative of market behavior during QE1 and QE2. Now that we are in QE3, look for more of this behavior to continue. 
• I don’t think it would be surprising to see sideways trading or additional selling over the course of the next few days. 
• Traders have their eyes fixed on SPX 1500, but it is more likely that this market will need to cool off some before moving higher. 
• We are starting to come off of the short-term overbought conditions in the market. 
• Fed’s QE3 launch is going to add a lot of buying power to this market and drive more people out of interest-bearing assets and into equities in search of some kind of return. 
• Going back years, there really is little in the way of resistance for the markets until it tests 1500.
• Resistance at 1437 and 1440 was broken with little problem and now becomes support. 
• 30-minute chart looks like a bull-flag pattern. 
• Upward trend-line off of the 6/4 lows has rising support at 1404. 
• SharePlanner Reversal Indicator confirmed the move higher this past week. 
• VIX above 14 despite yesterday’s sell-off. 
• One area of concern is the 3 large gaps off of the 6/4 lows that remain unfilled, including 6/6, 7/26, 8/3
• Should a sell-off ensue after the Fed action/comments today, look for support to come in at 1438.
• If another sell-off were to ensue, watch for a break and close below 1396 for a new lower-low in the market.  

My Opinions & Trades:

• Busy day trading yesterday. 
• Sold CRR at 72.77 from $72.27 for a 0.7% gain. 
• Bought GMCR at $31.74. 
• Bought GTAT at $6.73. 
• Shorted PRGO at $113.26. 
• Current stop-losses have been adjusted across the board. 
• ALXN stop-loss moved up to $109.50
• Stop-loss for NLSN at $29.30.
• Stop-Loss for WYNN increased to $110.50.
• Stop-Loss for BEAV adjusted to $40.00. 
• Remain long BEAV at $40.75, WYNN at $107.47, NLSN at $28.70, and ALXN at $102.53
• Track my portfolio RealTime here. 

Charts: