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: