Trading Plan for Dec. 20, 2010
Current Long Positions (stop-losses in parentheses): CX (9.76), CERN (93.77), AIT (30.65), NTRI (20.64), SNE (34.28)
Current Short Positions (stop-losses in parentheses): DTV (39.71)
BIAS: 29% Long
Economic Reports Due Out (Times are EST): None.
My Observations and What to Expect:
Futures are are up moderately.
Asian markets were all down, while European markets are showing strength of about 1%.
Last week was flat, and allowed the markets to consolidate, as was needed.
The S&P is set up well in the short-term to see a move higher.
The 10-day moving average continues to offer support, which is similar to the tendency of the S&P during the Sept/Oct rally.
New short positions in the portfolio offer a minimal reward at this juncture. Focus should primarily be to the long-side, waiting for price to indicate a change in market sentiment.
A rally to the 1260 level seems likely at this point.
1239 is a short-term support level that, should the market break and close below that level, could induce further selling.
All market indicators that I closely follow, including T2108 and NYSE Reversal Indicator, support the market rallying further in the short-term.
Below 1227, should we break it, the key support level for the S&P would become 1216 - the lows of previous consolidation.
For the bears - need to push the markets below 1239. Expectations at this point must be kept to a minimum, and to foil the bullish intentions of the market, will require baby-steps at this point.
For the bulls - push the market above 1246 and close above it. May be all the reason the market needs in the short-term to rally into the end of the year.
Here Are The Actions I Will Be Taking: