Current Long Positions (stop-losses in parentheses): CX (9.76), CERN (90.59), VPHM (17.77), AIT (30.65), NTRI (20.64), SNE (34.28)
Current Short Positions (stop-losses in parentheses): DTV (40.33)
BIAS: 29% Long
Economic Reports Due Out (Times are EST): Leading Indicators (10am)
My Observations and What to Expect:
- Futures are are mixed.
- Asian markets were flat/mixed, while European markets are showing some light selling.
- Today is options expiration (quadruple witching) and on such days, market action can become very erratic and unpredictable.
- Market showed a respectable bounce to the first wave of selling yesterday, as I thought it would, and bounced right off of the 10-day moving average and held its support just as it did most times during the Sept/Oct rally.
- S&P is set up nicely to make new rally highs in the coming days.
- All market indicators that I closely follow, including T2108 and NYSE Reversal Indicator, support the market rallying further in the short-term.
- Even so, the bulls are not far removed from the 1227 level, and that remains the support level that they must hold,
- Below 1227, should we break it, the key support level for the S&P would become 1216 – the lows of previous consolidation.
- Dip buying will continue to be the name of the game for traders.
- For the bears – the lack of follow through, on Wednesday’s selling, is troubling, and above all else, the bears will need to, at the very least, defend recent highs – failure to do so, could propel the S&P in to the 1260’s.
- For the bulls – continue the dip buying, like we saw yesterday, and extend the rally beyond recent highs, to avoid further consolidation in the markets.
Here Are The Actions I Will Be Taking:
