Trading Plan for October 22, 2010
Current Long Positions (stop-losses in parentheses): TICC (9.62), DTV (42.34), EOG (97.52), ESRX (46.42), AAPL (305.59)
Current Short Positions (stop-losses in parentheses): SDS (28.55)
BIAS: 56% Long
Economic Reports Due Out (Times are EST): No reports scheduled.
My Observations and What to Expect:
Futures are trading flat.
Asian markets were mixed and European markets are seeing some mild selling.
S&P managed to make new intraday-highs yesterday, but couldn't hold them - instead we have an indecisive doji candle.
We've had these doji candles quite a few times since bottoming in early September, but they marked signs of consolidation before advancing higher, not a topping pattern.
We also managed to hold the lows from Wednesday (very important).
Filled the gap down from Tuesday nicely, yesterday.
Amazon.com (AMZN) earnings not having any significant impact on the indices in the early going (unlike Apple's earnings).
Wouldn't pull the plug quite yet on this market - bulls show that they are still willing to buy the dip yesterday. Right now, I believe what we are seeing is consolidation - not a topping pattern as some are so quick to say.
Bears need to keep the bulls from buying the dips every time there is a sell-off. Ultimately it needs to push the market back below Tuesday's lows. Until then the bulls remain in control of this market.
Essentially we are a range-bound market since 10/12 between 1167 and 1190.
Some earnings reports due out before the bell: Verizon (VZ), Honeywell (HON), Ingersoll-Rand (IR), Schlumberger (SLB), Exelon (EXC).
Here Are The Actions I Will Be Taking: