Yesterday was a tough one as many traders got abused as market was weak most the day and intensified to the downside after the Fed minutes, then rallied in the last hour. That last hour rally probably got some guys out of their shorts and baited in some longs to make today’s open a bit frustrating for most. In the last week I talked about taking the foot off the throttle as this week had a lot of questions to answer. As of now if we close lower than the morning open. IBD would probably take us from “Market under pressure” to “Market Correction”.
“Minutes released yesterday from the March 13 Fed policy
meeting signaled it planned to hold off from increasing monetary
accommodation unless the economic expansion faltered or prices
rose at a rate slower than its 2 percent target. Data later
today from ADP Employer Services may show U.S. employment
increased by 206,000 last month, according to economists
surveyed by Bloomberg. China accelerated the opening of its
capital markets by more than doubling the amount foreigners can
invest in stocks, bonds and bank deposits.” –Mike Cohen
This morning we are down about 10 handles. S&P support is 1396-1402, and this has been the recent floor. That level on the SPY is $139.64-140.20. Another spot is 1391, and a major, major area is 1386-1388 (SPY $139-$139.10, then Major, Major is $138.55ish).
On days like this, you look to see if anything can lead us higher. Any groups or sectors. Leaders acted okay yesterday as there was a lot of selling under the surface. I will see if I can trade any of them to go positive for cash flow (we all know them). If they can’t fill downside gaps, today can break this accelerated/intermediate uptrend. I got stopped out of lots of positions yesterday. We have stops for a reason, make sure to honor them!
Disclosure: Scott Redler is long LNKD, LVS, DNKN. Short SPY.