Today's Trading Plan: An Actual Breakout Possible

Technical Outlook:

• SPX experienced a significant rally off of the employment number on Friday. 
• On the SPY there is a significant gap between Thursday and Friday that remains unfilled. 
• 2120 is the number to watch today on SPX – a break and close above this number would represent a significant change for the market going forward. 
• Otherwise, failure to break 2120 creates a scenario where the market remains range-bound. 
• VIX dropped back to the rising trend-line that has created multiple market reversals – falling 15% down to 12.86
• Significant snap-back in T2108 (% of stocks trading above the 40-day moving average) with a rally of 18.3% to 48%
• Russell unable to make a similar kind of move on Friday – representing about 1/2 of the total move in SPX. Daily chart remains heavily bearish. 
• SPX managed to reclaim all the major moving averages at the market open on Friday. 
• Solid volume on Friday – and well above average readings. 
• The market chop since mid-February continues to persist and get even tighter as the weeks pass by. 
• The market doesn’t care about the economy nor earnings. That is not what is driving it. The market only cares about what the Fed is doing to keep equities propped up. 

My Trades:

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Ryan Mallory is the co-founder of SharePlanner Inc, a financial website devoted to Day-Trading, Swing-Trading (both long & short) and exchange-traded funds. Ryan makes a strong emphasis on risk mitigation strategies, trading transparency, and trader education – not to mention a great set of stock screens as well.

Be Sure to Check out Ryan’s Site at Shareplanner.com