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Daily Trading Plan for July 12, 2011

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July 12, 2011 – Comments (0) | RELATED TICKERS: IDIX , SPY , PSTI

 

Current Long Positions (stop-losses in parentheses): 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.

Here Are The Actions I Will Be Taking:

 

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