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Trading Plan for May 31, 2011

May 31, 2011 – Comments (0) | RELATED TICKERS: SPY

Current Long Positions (stop-losses in parentheses): None

Current Short Positions (stop-losses in parentheses): None

BIAS: 100% Cash

Economic Reports Due Out (Times are EST): S&P Case-Shiller HPI (9am), Chicago (9:45am), Consumer Confidence (10am), State Street Investor Confidence Index (10am), Farm Prices (3pm)

My Observations and What to Expect:

Futures are up strong heading into the open. 

Asia was up on average 2%, while Europe is doing nearly the same. 

With this early market strength, we are poised to open in the mid-1340's on the S&P, which would break us out of the downward trend that we have currently been trading in for the entire month - that is a huge feat in itself. 

A close above 1347, would incite bullish enthusiasm going forward, representing a break of the previous short-term lower-high. 

With the early morning strength we are looking at opening above the 20-day moving average. 

On Friday, the market managed to close above the 10-and 20-day moving averages. 

Today's move, if it holds, looks as if we could be making a move to previous Recovery Highs. 

The most important is still 1294, which represents the previous higher-low. Break it, and things will unravel at the seams. 

My conclusion: Surprise move out of the market today, and should move hold, helps to repair the bullish sentiment and my willingness to go long aggressively in the short-term. 

Here Are The Actions I Will Be Taking: