Trading Plan for September 26, 2011
Current Long Positions: Netflix (NFLX) Nov 160 Calls
Current Short Positions: None
BIAS: 4% Long
Economic Reports Due Out (Times are EST): Chicago Fed National Activity Index, New Home Sales (10am)
My Observations and What to Expect:
Futures are up more than 1% heading into the open.
Asia saw losses of over -2% during their trading session. Europe has changed course and seeing gains range from 1% up to 3.3%
Some very bizarre overnight trading that saw us on the S&P futures -8, +15, -15 and +21. With Gold down over $100, and silver down over 10% at one point.
Based on the aforementioned volatility, I would expect the same to occur in trading today - for it to be a very volatile day - protect those gains that you have.
A major move from the market today would put us in a position to challenge the resistance and underside of the bear-flag breakdown level. This would occur at 1166 - about 30 points higher than current price.
The bulls have yet to successfully trade AND close below 1120 on the S&P. There is continued buying support at these levels. Should this level eventually break watch 1114, and then 1101 for additional support.
Volume has picked up over the last three trading sessions.
We are on pace for five straight down months in the market - the likes of which we haven't seen happen since 11/07-3/08
This week marks the last trading week for the quarter, and should expect some interesting price moves as we head towards Friday.
The panic in selling that we saw back in early August is clearly back, ripping off large chunks of share value across the board.
S&P confirmed the head and shoulders pattern from the past month.
My Conclusion: I'm not trusting the market strength this morning - overnight trading showed us that this market is trading on pins and needles, and that strength should be opportunities to book gains.
Here Are The Actions I'm Taking: