Current Long Positions (stop-losses in parentheses): AIT ($31.83), NTRI ($21.22), MENT ($12.01), AMZN ($177.15), F ($16.33), CERN ($93.98), OI ($29.67)
Current Short Positions (stop-losses in parentheses): None
Bias: 43% Long
Economic Reports Due Out (Times are EST): ICSC-Goldman Store Sales (7:45 a.m.), Redbook (8:55a.m.), S&P Case-Shiller HPI (9 a.m.), Consumer Confidence (10 a.m.), State Street Investor Confidence Index (10 a.m.)
My Observations and What to Expect
* Futures are up slightly.
* A number of economic reports due out today, but nothing that I’d consider “market-movers.”
* Asian markets are mixed, while European markets are showing a slight bit of strength.
* Volume was extremely light yesterday, and will continue to be so throughout this week.
* As mentioned in yesterday’s trading plan, yesterday’s gap down was filled, and any other gap downs we see this week will likely be met with the same fate.
* China’s surprise rate hike had little impact on the markets yesterday.
* Yesterday represented the second day of consolidation at the recent highs of this market.
* Any kind of surge in the market, where we rally, say 10 points or more on the S&P 500 Index, will be a good opportunity to take profits off the table.
* Rally continues to be very healthy, backed by dip buyers, with a steady upward expansion.
* There is about 10 points of give back on the S&P from where it currently sits, and where the nearest level of support lies at 1247. Any sell-off within those parameters keeps the markets and the short-term uptrend intact without question.
* Breaking support at 1247, and the 10-day moving average, could usher in short-term weakness in the market.
* The dollar is once again looking a bit top-heavy and poised to move lower in the short-term, which should strengthen this market rally.
* The lows from Dec. 15 and 16 represent, in my opinion, the “higher-lows” in this recent market rally, and a break below them at 1232, would significantly stall this market’s upward progression and potentially invite a new trend to the downside.
* Below 1227, should we break it, the key support level for the S&P would become 1216 — the lows of previous consolidation.
* For the bears — use the seasonally light volume to push markets lower, with the first target being 1247.
* For the bulls – break the highs from last Wednesday, and out of the two-day consolidation.
Actions I Will Be Taking
* May add new positions to the portfolio, particularly Eastman Chemical Co. (NYSE: EMN), which I will be watching at $83.04.
* Increased the stop-losses in Applied Industrial Technologies (NYSE: AIT), NutriSystem Inc. (NASDAQ: NTRI), and Mentor Graphics Corp. (NASDAQ: MENT).
* Added Cerner Corp. (NASDAQ: CERN) at $95.67 and Owens-Illinois Inc. (NYSE: OI) at the close at $30.87 yesterday.
* Stocks in my portfolio that are on my “chop-block” should their weakness continue are Amazon.com (NASDAQ: AMZN), NTRI, and Ford (NYSE: F).
* Follow me in the SharePlanner Chat-Room today for all my live trades and ideas.
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