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Trading Plan for September 23, 2011

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September 23, 2011 – Comments (0) | RELATED TICKERS: SPY

 

Current Long Positions: None

Current Short Positions: None

BIAS: 100% Cash

Economic Reports Due Out (Times are EST): None

My Observations and What to Expect:

Futures are down about 1% heading into the open. 

 

Asia saw average losses of about -1.6%, and Europe is trading with losses of as much as -3.5%

We FINALLY confirmed the bear flag that the entire market has been trading in over the last month. 

Key Support levels I am watching today is 1120, yesterday's lows at 1114, and the 8/9 lows at 1101. Break all three and we're headed for 1040. 

1164ish on the S&P will represent resistance from the underside of the bear-flag, should this market rally today. 

Volume has increased over the three days, and one of the strongest volume readings since early August when the market sold off substantially. 

We are on pace for five straight down months in the market - the likes of which we have seen happen since 11/07-3/08

The panic in selling that we saw back in early August is clearly back, ripping of large chunks of share value across the board. 

The market, (S&P) exhibited strength through out most of the day, spending a good portion of it's afternoon range-bound at the highs, and then in the final 1.5 hours of trading, the S&P gave back all of its gains and finished in the red.

Somewhat of a large doji candle pattern after a significant gap down yesterday, leaving it unfilled for the time being. 

S&P confirmed the S&P head and shoulders pattern from the past month. 

My Conclusion: The easy month to the short side has been made, dropping as much as +100 points on the S&P in about 14.5 hours of trading. Still more weakness can be ahead, but your expectations have to be tempered, and smaller gains should be taken to avoid that grisly dead-cat bounce. 

 

Here Are The Actions I'm Taking:

 

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