The 2 Most Important Numbers for Traders

Bears need a close below S&P 1,173; the bulls above 1,200

   

The 2 Most Important Numbers for Traders

Current Long Positions (stop losses in parentheses): TICC ($10.28), RAH ($60.75), EQY ($16.75), PH ($78.95), BAC ($11.02)

Current Short Positions (stop losses in parentheses): DTV ($42.55), EQR ($51.15), VPRT ($42.37), TIE ($17.84), ITT ($48.01) GLAD ($11.54), FCN ($36.74)

Bias: 18% Short

Economic Reports Due Out (times are EST): ICSC-Goldman Store Sales (7:45 a.m.), Redbook (8:55 a.m.), S&P Case-Shiller HPI (9 a.m.), Consumer Confidence (10 a.m.), State Street Investor Confidence Index (10 a.m.), Farm Prices (3 p.m.)

My Observations and What to Expect

* Futures are down slightly.

* Asian markets finished the day down, with the Nikkei off 1.9%. European markets are mixed.

* Despite the U.S. market finishing down yesterday, the market showed a lot of intraday strength rallying off of the 1,173 price level on the S&P 500.

* Even with recent market weakness, dip buying is not dead as of yet, though the last three hammer candles have been met with a significant sell-off the following market session.

* A bearish descending triangle is forming on the S&P, signaling that a break to the downside could be imminent.

* The S&P continues to find support from the October consolidation range.

* We dipped below the 50-day moving average, but quickly rebounded to finish well above it.

* The only price level the bears need to concern themselves with is 1,173. If we close below it, the upward trendline from the August lows is dead.

* The bulls should aim for 1,200 and close above it, which would also represent the 20-day moving average.

Actions I Will Be Taking

* Will add two new positions to the portfolio (one long, one short).

* Stop losses remain as is.

* Added Bank of America Corporation (NYSE: BAC) (long) and FTI Consulting, Inc. (NYSE: FCN) (short) to the portfolio yesterday, near the close.

* Stopped out of Harris Corporation (NYSE: HRS) with a small loss and Mentor Graphics Corporation (NASDAQ: MENT) slightly above breakeven.  

* Follow me in the SharePlanner Chat-Room today for all my live trades, including my day trades.

The SharePlanner Swing-Trading System is a proven trading strategy that has outpaced all the major indices with an 8-year return of over 1,010%. This year alone it is up 29%, with 64% of the stock picks being winners. It’s an easy trading system that requires very little effort after you buy the stock and great for those who can’t watch the market all the time! Find out more by visiting SharePlanner.com.


Article printed from InvestorPlace Media, http://investorplace.com/2010/11/the-2-most-important-numbers-for-traders/.

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