Bull Flag Pattern Still In Play

My Swing Trading Approach

I added one position yesterday in the leading sector, industrials, but only a small amount of my capital is being put to use here, as long as the market remains uncooperative in the short-term.

Indicators

Volatility Index (VIX) – Dropped 4.8% yesterday, but the inverse head and shoulders pattern remains in place. Current reading is at 14.16.

T2108 (% of stocks trading above their 40-day moving average): Gave up most of its gains on the day, but still managed to pop 4.4% to 50% overall.

Moving averages (SPX): The 5-day MA crossed below the 10-day MA, while price held the 20-day MA, it could not hold the intraday break of the 10-day MA into the close.

Sectors to Watch Today

Telecom exhibited a lot of strength today, but not necessarily enough to get overly optimistic on the sector. Industrials continues to consolidate at the recent highs and looks poised for a solid break higher. Technology continued with the bounce off of the June lows.

My Market Sentiment

Bull flag pattern still in play, and potential bounce off of the 20-day moving average, though yesterday’s price action wasn’t inspiring. Market poised to gap lower, the key becomes whether the bulls can fill the gap as the market has done a lot of lately.

S&P 500 Technical Analysis