Today’s Trading Plan: Searching for a Pulse

Technical Outlook:

• Another snooze fest for S&P 500 (SPX) yesterday as price went absolutely nowhere (closed 0.13% higher). 
• Of late, any morning price gains ultimately sees an early afternoon sell-off that wipes out those gains and takes the market into the negative, only to see a bounce in the final hour of trading.
• Converging moving averages just underneath the current price action on SPX offers a good amount of support (5,10,20-day moving averages). 
• United States Oil Fund (USO) showing signs of weakness again as it struggles to push past the 20-day moving average the last two trading sessions. 
• If crude drops back below $40/barrel, and remaining market strength should cripple. 
• SPDRs S&P 500 ETF (SPY) saw an increase in volume levels but still extremely light and only about 1/2 of recent averages. Apparently Wall Street is squeezing in some last minute vacations. 
• Two short-term support levels to watch in this market is 2175, and then 2155. The former price level needs to hold to maintain the breakout that occurred last Friday. That latter would represent a change in the bullishness of the market. 
• CBOE Volatility Index (VIX) seeing some short-term resistance at the 11.80 to 12.00 area. Short-term support could be forming here at recent lows as well (11.40’s). 
• SPX 30 minute chart maintaining support at 2175 but not showing much initiative beyond that. 
• 2200 should ultimately be tested for the bulls. 
• Nasdaq Composite (COMPQ) remains the healthiest of all the indices with a strong uptrend still in place. 
• Dow Jones Industrial Average (DJIA) is at risk of putting in a double top. Must break through the July highs to change that. 
• The bulk of the earnings season is behind us. No significant disasters from the big names that reported that negatively impacted the market as a whole. 
• Overall, August is the worst performing month for the Dow and S&P 500. 
• At this point, and with the election ahead, I’d expect the market to keep rallying higher. I don’t expect there to be a rate hike between now and the election. To do so would impact the market and thereby the election. I don’t think the Fed wants that, particularly since Trump has indicated that he would replace Yellen. 

My Trades:

• Added two new swing-trades to the portfolio yesterday. 
• Sold CAT yesterday at $83.04 for a 0.8% profit. 
• Sold CVX yesterday at 101.22 fgor a 0.5% profit. 
• May add 1-2 new swing-trades to the portfolio today. 
• Will consider hedging the portfolio as well with a short position. 
• Currently 60% Long / 10% Short / 30% Cash
• Join me each day for all my real-time trades and alerts in the SharePlanner Splash Zone

Chart for SPX: