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Trading Plan for March 14, 2011

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March 14, 2011 – Comments (0) | RELATED TICKERS: SPY

Current Long Positions (stop-losses in parentheses): TICC, MPEL (7.11), AAPL (338.23), CHK (30.76)

Current Short Positions (stop-losses in parentheses)None

BIAS: 31% Long

Economic Reports Due Out (Times are EST): None

My Observations and What to Expect:

Futures are down strong ahead of the open. 

Japan's market dropped 7.8%! while the rest of Asia was slightly up. Europe was down across the board as much as 1.34%.

S&P rebounded nicely on Friday, but opened slightly below the 2/24 lows before recovering. 

Price managed to close back above the 50-day moving average, but the volume wasn't overly impressive and was below average.

At this point, I have to assume that the rallies that we see going forward be considered dead-cat bounces. 

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

1275 on the S&P will be the next logical support level for the S&P to test if we break the 2/24 lows. 

For the bears - Close below 1294 and end the 6 month rally of late. 

For the bulls - Recover from the early morning losses that we are looking at, and if possible push higher than the Friday highs. 

My conclusion: With recent selling of late, the market is starting to rapidly shift into the hands of the bears, in which all rallies should be viewed through a lense of skepticism. 

Here Are The Actions I Will Be Taking:

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