Trading Plan for November 2, 2010
Current Long Positions (stop-losses in parentheses): TICC (9.62), GLD (130.99), SSO (41.84), SNDK (36.59), AMZN (161.08), BAC (11.34)
Current Short Positions (stop-losses in parentheses): None
BIAS: 52% Long
Economic Reports Due Out (Times are EST): FOMC Meeting Begins, ICSC Goldman Store Sales (7:45am), Redbook (8:55am)
My Observations and What to Expect:
Futures are up moderately, and have steadily improved throughout overnight trading.
Asian markets are slightly up, while Europe is seeing some respectable gains on the day.
The inability of the market to break through the 200-week moving average, has halted this market in its tracks the last 2-weeks. A break through would nearly guarantee we go much higher.
Bulls did breach the 200-week moving average yesterday on an intra-day basis, which isn't something the bulls were able to do the previous two times.
A test of the 10/25 highs failed as we touched them and then proceeded to sell-off thereafter.
A very large doji candle yesterday is the 7th in the last 8 market sessions.
Once again, the bulls managed to keep the markets above the 10-day moving average at the close despite trading below it on an intra-day basis.
A break and close above 1196 would ensure us that we have broken out of consolidation.
Election mid-terms have seen bullish returns the last three times, and overall, mid-term election week, historically, tends to be very bullish.
The bears should focus their efforts in just closing below the 10-day moving average today. After that, the focus should be on pushing below Wednesday's lows at 1171.
Here Are The Actions I Will Be Taking: