The market opened down hard on the durable goods orders and jobless claims. As it turns out the SPY put in its low for the day at 9:46 holding the 20 day MA (108.96) and then rallying later in the day closing at the highs just below the 50 day MA (111.02). We are still stuck in this range and technically in no man’s land until we break one of the levels. It does however make for some decent trading opportunities, if you can pick up shares around the moving averages and then have the patience to hold on. I caution that this will not last for long and we need to continually monitor these MA’s until one of them gives.


Today’s come back was pretty impressive and came on some decent volume which was also encouraging. The TBT/SPY trade is still intact but another day of strength in the bond market and the TBT leg will likely be stopped out, but the SPY leg is still working. Today’s rally and the bullish charts I mentioned yesterday (IWM, IYR, IYT, IYR, XLY, XRT) make me feel better about this leg of the trade.

I can’t stress enough the importance of the moving averages (20,50,150,200) in the stocks, indexs and etf’s that you are trading. In a market that is trying to find a direction these levels are crucially important. If you are involved in a name you need to know these levels. Go through your charts from today and see how many stocks bounced off of or stopped at the 20 or 50 day MA you will be surprised. For illustration look at the SPY 20 day MA (108.96) low of the day 108.94 and ORCL 50 day MA (24.20) low of the day 24.21 and AAPL 50 day MA (202.91) high of the day 202.86. These are just three examples but there are dozens out there.

The snowicane here in the northeast will probably keep me from trading tomorrow but I do have a few ideas that I like.

aet 30ish long

anf 36.25 long

bke 30 long

gpn 42.5 short

rah 67 long