The Bull’s showed resilience defending price support.

Defending price support with the Bears on the attack was important yesterday but price resistance continues to pose a problem.  I have to admit that the Bulls displayed much more resilience than I was expecting.  Great job Bulls!  As a result, I want to be very bullish, but the fact remains that both the DIA and the SPY remain in a sideways consolidation.  Don’t get me wrong I’m very grateful the Bulls defended the borders but they still seem to lack the energy to breakout.  Futures are suggesting the Bears may be trying to regroup to mount another offensive this morning.  Can the Bulls continue to hold?

On the Calendar

The Economic Calendar kicked off early today with a Fed speaker at 6:25 AM Eastern.  The good news is that’s the only Fed member with something to say today!   Is it just me, or does anyone else miss the days when the Fed was a lot more tight lipped?  LOL.  The weekly Jobless Claims numbers are a 8:30 AM as is the biggest number of the day Producer Price Index.  On the earnings front, we will receive reports from over 300 companies today.  The earnings calendar finally begins to lighten up next week and slowly wind down this quarter’s reports.

Action Plan

If the Bulls continue to show resilience defending support as well as they did yesterday, we will be in good shape.  However, the Bears are attacking again this morning with the futures pointing to a lower open.  Currently, hold 13 long positions I think is necessary to exercise a little caution on entering new trades.  At the close of yesterday, all 13 positions were winners, so my top priority will be managing current trades and possibly taking some profits.

With the majority of the open positions being tech related I will keep a close eye on the QQQ.   If there is a weakness there, I will be more inclined to start banking gains and reduce risk.  I suggest everyone tighten up your stops.  Remember trades can happen much faster than it’s possible to send out alerts.  If you’re happy with the gain, take it.  You can never go broke taking a profit!

Trade Wisely,

Doug