Market Sell Bolstered by Apple News

by Ryan Mallory | January 18, 2011 11:57 am

Current Long Positions (stop-losses in parentheses): None

Current Short Positions (stop-losses in parentheses): None

BIAS: 100% Cash

Economic Reports Due Out (Times are EST): Empire State Manufacturing Survey (8:30 a.m.), Treasury International Capital (9 a.m.), Housing Market Index (10 a.m.)

My Observations and What to Expect:

• Futures are mixed, with the NASDAQ (NASDAQ: .NDX[1]) down due to Steve Jobs going on medical leave.
• Asian markets were flat, while European markets show strength in excess of 1%.
• Steve Jobs going on medical leave, and Apple (NASDAQ: AAPL[2]) reporting after the bell, will be the focus of traders today.
• Apple will act as a major drag on NASDAQ today and technology stocks in general.
• A lot of reasons to believe the market will see some selling pressures in the days ahead. Particularly the overhead resistance in terms of price channels and Bollinger Bands that typify a pullback scenario.
• With that said, it appears that risk is increasing by a large amount at this juncture while reward looks greatly limited at this point.
• A pullback in the S&P 500 Index to 1270 would be ideal (lower, short-term price channel), to help the market relieve some of the overhead pressures that it is currently facing.
• There should be some support at 1278 on the S&P.
• A strong move out of the upper price band, could see the S&P push higher up to 1310.
• But expect some resistance at 1300 – a lot of talk about the market reaching that milestone, and now that it has, we could see a flood of profit takers hit the wires.
• 1261 represents the short-term ‘higher-low’.
• Volume was slightly stronger on Friday then previous sessions. An increase today from Friday, on market strength would further encourage the bulls.
• The more long-term trend-line dating back to Sept. 1 currently has support at 1247.
• For the bears – Use the overbought nature of this market and the weakness created by Apple today, to pounce on the bulls.
• For the bulls – Breakout of the short-term price band overhead, and make a move for 1300, and close above the critical milestone.

Here Are The Actions I Will Be Taking:

• 100% Cash today heading into the open.
• On Friday, closed F5 Networks (NASDAQ: FFIV[3]) at $143.90 for a .8% loss, Schlumberger (NYSE: SLB[4]) at $86.77 for a 2.4% gain, First Solar (NASDAQ: FSLR[5]) at $140.66 for a 0.9% gain, MeadWestvaco (NYSE: MWV[6]) at $27.18 for breakeven, BB&T Corp. (NYSE: BBT[7]) at $27.72 for a .8% gain, and Brigham Exploration Co. (NASDAQ: BEXP[8]) at $28.34 for a .5% loss.
• Will consider day-trading the breakout setups that look the most appealing to me.
• Willing to jump back in to the long side, should the market show unabated strength.
• May look at trading Apple some today.
• Initiating one to two new short positions is not out of the question today.
• Follow me in the SharePlanner Chat-Room[9] today for all my live trades and ideas.

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%. 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[10].

Source URL: https://investorplace.com/2011/01/market-sell-bolstered-by-apple-news/

---