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Today’s Trading Plan: Back to the Breakout Level
Thursday, October 15, 2015 6:11
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Technical Outlook:
- Yesterday marked the second day of selling for SPX, pulling back to the 50 day moving average which it managed to test and hold.
- SPX pulled back to the breakout level of the double bottom yesterday.
- In order to jump-start the next leg up for the market, SPX is going to need to close above 2021.
- Volume on SPY was below average but increased over the past two trading sessions.
- On the daily chart of VIX there is heavy reistance at 20.
- VIX rose another 2% yesterday to 18.03.
- Price action on lowering future revenue expectations with Walmart (WMT) weighed heavily on retail stocks.
- Resistance in the 2040′s is expected to be a difficult challenge for SPX going forward.
- Weekly Chart of SPX suggests that it needs to close over 2020 this week to clear resistance at that price level.
- 30-minute chart of SPX is showing distribution taking place.
- The low-volume sell-off on the SPY suggests that this pullback we saw yesterday is being conducted in an orderly manner with no real signs of panic.
- Ultimately, I wouldn’t be surprised if the current rally in equities continues until VIX goes sub-11 again.
- 2059 is the break-even level for the market on the year. It also happens to be where the 200-day moving average is sitting at.
- The Fed has never raised interest rates at a point where the market was trading lower on the year.
My Trades:
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
Source: http://www.shareplanner.com/featured-blogs/ryan-mallory/daily-trading-plans/21613-todays-trading-plan-back-to-the-breakout-level.html
