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Trading Plan for November 28, 2011

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November 28, 2011 – Comments (0) | RELATED TICKERS: SPY

Economic Reports Due Out (Times are EST): New Home Sales (10am)

The Breakdown:

Futures are sky-rocketing ahead of the open - S&P up over 30 points. 

Asia traded up on average of 1.7% higher, while Europe is trading with gains ranging from 2.3% up to 3.7%.

The S&P is looking to bounce after 7 straight days in the red, four straight outside the lower bollinger band. 

From the October lows to the October highs, we have retraced perfectly to the 61.8% retracement level on the S&P. 

Leading up to today, this was the a near perfect bounce environment

Two S&P resistance levels to watch today and this week are 1191 and then at 1218.

Finally, a break of the downward trend-line (mid-term) off of the October highs would effectively end at 1255 (resistance is declining). 

All indicators point to a very oversold market on both the short-term and intermediate-term time frames. 

Volume has been tapering off the last 5 trading sessions. Mostly due to last week's holiday schedule. 

If we can hold most of the day's gains, we should be able to see a nice multi-day rally out of this market. 

All significant moving averages are above the current price action.

Worth noting as well, is the obvious head and shoulders pattern forming on the weekly chart. Should this be the case, I'd expect then that this market is reaching a short-term top very fast.

Make sure that whatever you do, that you protect the gains that you have, and be ready for sudden and quick reversals in this market.

Here's the Conclusion & S&P Chart Analysis.

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