Trading Plan for June 30, 2011
Current Long Positions (stop-losses in parentheses): HDY (4.12)
Current Short Positions (stop-losses in parentheses): STNG (10.39)
Economic Reports Due Out (Times are EST): Jobless Claims (8:30am), Bloomberg Consumer Comfort Index (9:45am), Chicago PMI (9:45am), EIA Natural Gas Report (10:30am)
My Observations and What to Expect:
Futures are slightly higher heading into the open.
Asia finished with gains ranging from 0.2% up to 1.5%, while Europe is overall, slightly green.
S&P is attempting to put together its fourth consecutive day of gains.
Watch the 50-day moving average at 1317 for resistance, and more so the descending upper channel line, which will provide heavy resistance at 1320.
Today we'll see the 10-day cross the 20-day moving average to the upside, which is a good sign the technical damage on the S&P is slowly getting repaired.
I would be careful about piling into a lot of long positions here in the short-term, as the bears will at some point try to initiate new short positions in hopes of resuming the downward trend, and with a 40-point rally in the S&P in the last three days off of the lows, we are likely due for at least some pullback/consolidation.
Watch for some unpredictable price action with it being quarter/month end today.
We managed to create a 'higher-high' on the S&P yesterday helped to effectively end the downward trend that began on 5/2.
Nasdaq formed a shooting star pattern yesterday, which could be ominous of some exhaustion by the bulls in the short-term.
NYSE Reversal Indicator shows us that a rally over the next couple of weeks is likely.
My conclusion: Bullish on an extended move going forward, but wouldn't be surprised to see some profit taking or a pullback over the next couple of days.
Here Are The Actions I Will Be Taking: