Technical Outlook:
- SPX finished lower for the first time after five straight green days.
- Futures following Friday's close sunk on the failed coup attempt in Turkey. All those losses were erased with the opening print on Sunday night.
- 5-day moving average still holding strong on the current market rally.
- At this point, the market could really benefit from some consolidation, in order to avoid a sharp pullback.
- SPY (NYSE:SPY) volume increased for a second straight day, and came in at slightly above average.
- SPX 30 minute chart may be starting to see some consolidation on the 30 minute chart.
- VIX continues to trade lower, and move below key support at 13 - a support level that has held for the better part of two years.
- T2108 (% of stocks trading above their 40-day moving average) is starting to flat line a bit at 78-79% over the past few days.
- Oil continues to bounce around over the past 7 trading sessions. Most noticeable on the USO (NYSE:USO) chart.
- Advancing stocks on a daily basis, compared to declining stocks have not been as strong over the past 2-3 trading sessions.
- I could easily see a pullback to the 2120 level which was the breakout area for this market, in the coming weeks, without ruining the upside potential of the market going forward.
- At this point, and with the election ahead, I'd expect the market to keep rallying higher. I don't expect there to be a rate hike between now and the election. To do so would impact the market and thereby the election. I don't think the Fed wants that, particularly since Trump has indicated that he would replace Yellen.
- There is a great deal of bullishness to this market right now despite the prevalent amount of worry. It has been over two years since the market has actually seen a legitimate rally and so it wouldn't be surprising to see this market continue its current trend higher as shorts are forced to face the new reality of the market.
- Market is assuming that rate hikes are pretty much off the table for all of 2016.
My Trades:
- Sold Canadian National Railway Company (NYSE:CNI) on Friday at $62.45 for a $4.0% profit.
- Covered Royal Caribbean Cruises Ltd (NYSE:RCL) on Friday at $69.71 for a 3.9% profit.
- Sold Netflix Inc (NASDAQ:NFLX) on Friday at $98.37 for a 2.4% profit.
- Sold United States Oil (NYSE:USO) on Friday at 10.96 for a 1.4% profit.
- Added one new long position to the portfolio on Friday.
- May add 1-2 new swing-trades to the portfolio today.
- Currently 20% Long / 80% Cash
