by Ryan Mallory | December 6, 2010 10:25 am
Current Long Positions (stop losses in parentheses): VMW ($82.30), RRC ($44.59), FINL ($18.60)
Current Short Positions (stop losses in parentheses): DTV ($41.12), GOOG ($590.10)
Bias: 4% long
Economic Reports Due Out: None
* Futures are slightly negative heading into the Monday open.
* Both Asian and European markets are mixed in trading.
* S&P 500 1,200 will act as support for the markets, while 1,227 is the major battleground currently between the bulls and bears.
* A pullback or at the very least some consolidation in the markets seems to be in the cards this week, before moving back up again. Typically pullbacks in a strong, trending market are very quick and don’t give bulls a huge opportunity to jump in at the lower prices they seek.
* Intraday charts, particularly the 30-minute and 60-minute charts on the S&P, show a very overextended market.
* A break of the November highs could send the market up into the 1,250s.
* Volume has been average during this three-day rally, with Friday’s volume being well below the average — perhaps showing some exhaustion by the bulls.
* The current rally has the makings of what we saw back on Sept. 1, which rallied for over two months.
* Going forward, I would expect the dip-buying to be back in play for traders.
* The U.S. dollar failed to hold the trendline, and instead moved much lower.
* The bears must defend the resistance at the November highs and close below Friday’s lows.
* If a pullback/consolidation occurs in the near-term, the bulls need to avoid giving back too much of the day’s gains.
* Will consider adding some additional long positions to the portfolio today.
* Closely monitor my short positions, especially Google Inc. (NASDAQ: GOOG[1]) in light of Groupon bid rejection that may lift shares.
* Tightened the stop-losses in DIRECTV (NASDAQ: DTV[2]), Range Resources Corp. (NYSE: RRC[3]) and The Finish Line, Inc. (NASDAQ: FINL[4]).
* Sold out of my Novellus Systems, Inc. (NASDAQ: NVLS[5]) position in the pre-market, after a downgrade was received. No desire to risk losing my profits on the position.
* Closed positions in Petrohawk Energy Corporation (NYSE: HK[6]), Parker-Hannifin Corporation (NYSE: PH[7]) and Visa Inc. (NYSE: V[8]). All except for V were for solid gains.
* Follow me in the SharePlanner Chat-Room[9] today for all my live trades, including my day trades.
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