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Trading Plan for March 11, 2011

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March 11, 2011 – Comments (0) | RELATED TICKERS: SPY

Current Long Positions (stop-losses in parentheses): TICC, LIZ (5.33), IRC (9.23), MPEL (7.11), AAPL (338.23), FFIV (105.10)

Current Short Positions (stop-losses in parentheses)None

BIAS: 48% Long

Economic Reports Due Out (Times are EST): Retail Sales (8:30am), Consumer Sentiment (9:55am), Business Inventories (10am)

My Observations and What to Expect:

Futures are slightly down but well off their overnight lows.

 

Asian markets traded lower in excess of 1% on average while Europe is seeing losses range from -0.2% to 1%.

 

S&P is at the cusp of ending the rally from 9/1 and beginning a new downtrend, if it manages to break the lows from 2/24.

 

The 50-day MA on the S&P was broken yesterday, as the bulls failed to get a substantial bounce in price off of that significant support level.

 

Should we see a move below 1294 and close below that level, we will then enter a stage of the market where market rallies should be used as opportunities to go short.

 

Volume was very high yesterday, and declining issues was extremely negative.

 

The next level of support for the S&P lies at 1275.

 

A break of S&P 1294 (last week's lows) would put in a lower-low in the markets, and confirm a downtrend being in place.

 

For the bears - Closing below 1294 is a MUST today.

 

For the bulls - Hold  1294, and regain the 50-day moving average for support.

 

My conclusion: With yesterday's sell-off, market direction is becoming much more clearer, where longs need to be looking to exit their positions and protect their capital.

 

Here Are The Actions I Will Be Taking:

 

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