Trading Plan for April 27, 2011
Current Long Positions (stop-losses in parentheses): HRB (17.39), GOOG (522.00), ADI (38.99), CA (23.95), UNP (95.45), NFLX June 270 Calls.
Current Short Positions (stop-losses in parentheses): None
BIAS: 51% Long
Economic Reports Due Out (Times are EST): MBA Purchase Applications (7am), Durable Goods Orders (8:30am), EIA Petroleum Status (10:30am), FOMC Meeting Announcement (12:30pm)
My Observations and What to Expect:
Futures are up slightly heading into the open.
Asian markets were mixed with Japan being up 1.4%. Europe is seeing gains of about 0.5% today.
We broke the S&P 1340 stronghold in a very convincing manner yesterday, and closing a fresh recovery highs. Very strong positive for the markets.
By breaking 1340, we confirmed the inverse head and shoulders that had been in development since February '11. Last time we confirmed a IH&S pattern was back in Sept '10 and we rallied 220 points after the confirmation.
The next logical resting place for the market is 1430, which would mark a very strong move by the markets.
One anomaly about yesterday's trading action was the weakness in AAPL, BIDU, AMZN, VMW, and others despite the market being up strong.
Like yesterday, I think we'll see a lot of short covering in the days ahead, as the bulls give up their bearish positions and forced to cover.
Watch the Bernanke Press Conference today - it is at 12:30pm EST, and could throw us a curve ball. Should create some market volatility.
The much talked about double top in the markets has been rendered null and void with a breakout to new highs yesterday.
Higher-low has been established at 1294.
Market is overbought in the short-term.
Silver is looking like it is in the process of rolling over here based on volatility and volume levels.
My conclusion: I'm cautious about the Fed Statement today, but overall, I am positive on this market to march higher in the short and intermediate time-frames.
Here are the Actions I'll be Taking.