Current Long Positions (stop-losses in parentheses): BWS (10.61), FVE (5.77), PSTI (3.09), IDIX (5.33), SPY August 136 Calls

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

BIAS: 6% Long

Economic Reports Due Out (Times are EST): NFIB Small Business Optimism INdex (7:30am), ICSC-Goldman Store Sales (7:45am), International Trade (8:30am), Redbook (8:55am), FOMC Minutes (2pm)

My Observations and What to Expect:

  • Futures are moderately lower, but well over 15 points off of the S&P futures’ lows.
  • Asia saw a lot selling between -1.5% and -3.1% and Europe is seeing, on average, about 1% in declines.
  • Futures, overnight, were down as much as 24 points, and are seeing a significant bounce/reversal off of those lows.
  • The S&P futures saw the reversal occur right at the 61.8% retracement level.
  • We dropped back below the 10-day moving average yesterday, but held the 38.2% retracement yesterday on the S&P, as well as the 50-day moving average.
  • The next moving average to test in the coming days will be the 20-day MA.
  • Volume saw a slight increase over Friday’s levels, but remains well below average.
  • Important that you pay attention to the Fibonacci retracement levels today. On the S&P the 38.2% is at 1318, and the 50% is at 1307.
  • Potential Head and Shoulders pattern forming on the S&P.
  • Yesterday’s rally, didn’t really do anything in the way of technical damage on the charts.
  • S&P managed to break through 1345 yesterday, which only leaves 1370 as the last remaining resistance barrier between current price and new recovery highs.
  • My Conclusion: To many gap-downs occuring in the market, which is in large part why I think this sell-off in the pre-market is getting bought so quick. I expect that we see a nasty day for the bears today, and the potential for a strong rally.

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Here Are The Actions I Will Be Taking:

  • Sold PSTI yesterday at $3.63 for a 11.7% gain, sold PDLI at $6.31 from $5.97 for a 5.7% gain (day-trade). Stopped out of FVE at $5.78 for a 4.5% loss, and BWS at $10.61 for a 3.6% loss.
  • Added IDIX yesterday at $5.51.
  • Added SPY August 136 Calls at $1.03
  • Will continue to day-trade the market with my focus being on small-cap stocks.
  • 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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