Daily Trading Plan for December 14, 2011
Economic Reports Due out (Times are EST): MBA Purchase Applications (7am), Import and Export Prices (8:30am), EIA Petroleum Status Report (10:30am)
Futures are slightly lower heading into the open.
Asian markets were down about -0.5% in trading.
Europe is currently trading lower at an excess of -1%
Technical Outlook (S&P):
The S&P gave up all of its gains on the day (more than 1% worth) and finished decisively in the red for the day, due to the reaction of the Fed's FOMC statement yesterday.
The S&P gave us the follow through that we were looking for from the market on Monday's sell-off.
We saw price action drop below the 20-day and 50-day moving average intraday, but finish a shade above them to close out the day.
A fairly decent amount of price support exists at 1219, which is where we bounced at yesterday. If we break this level today, the next level is 1218, which comes from a trend-line formed off of the lows formed on 10/4.
Volume was noticeably higher than in previous days.
The S&P has come off of its overbought short-term conditions.
For two straight days the VIX has been down despite the market also being down. Typically the VIX would be noticeably up on such days.
The 200-day moving average continues to act as a problem for the S&P at 1262, watch for whether price can close above this level.
The bull-flag on the 30-minute chart that we spoke of yesterday was broken with the afternoon sell-off.
Trend-line off of the 7/7 highs, just above the 200-day MA on the S&P, continues to act as resistance to price as well.
Note the larger downward channel that we are in as noted below.