Today’s Trading Plan: Going For Six Straight Weeks

Technical Outlook:

  • SPX rallied on Friday for a third straight day following the FOMC Statement. 
  • The downtrend off of the November highs has been tested but not broken. A minor rally today would lead to a break of that downtrend. 
  • Russell broke out of its bull flag pattern after lagging the market early on last week. 
  • Biotech stocks continue to show notable weakness which has held the Nasdaq back some. 
  • The DIA ETF for the Dow Jones Industrial has been by far the most impressive, rallying 8 straight days and 13 out of the last 14 days. 
  • VIX is quickly approaching a range between 11 – 13’s that leads to a bit more choppiness in price action.
  • T2108 (% of stocks trading above their 40-day moving average) is now at 87.13% – the last time it closed this high was in February of 2012. 
  • The last time that SPX moved down more than 10% and then finished in the green for the quarter was 1933. Obviously, what has been seen so far in 2016 has never been seen by anyone currently trading. 
  • SPX rallied for a 5th straight week, and in excess of 1% each time – not seen since the bottom of March 2009 was hit. 
  • Volume has increased each of the past four trading sessions but still below recent averages. 
  • The biggest issue surrounding this market at this time is that reward with long setups is just on par with risk. 
  • 30 minute chart of SPX still holding strong but well overextended in the short-term. 
  • My Trades:

  • Did not add any new swing-trades yesterday. 
  • Did not close out any swing-trades on Friday.
  • Currently 100% Cash
  • Careful to add long exposure considering that the market is as overbought as has been in years. A pullback, not necessarily a major one is in order here. 
  • Chart for SPX:

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    Author: Travis Esquivel

    Travis Esquivel is an engineer, passionate soccer player and full-time dad. He enjoys writing about innovation and technology from time to time.

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