$SPX 60 Minute: If the market has finished this leg up, then it's a double zig zag failing right at resistance lines on the top pitchfork and over head (see daily chart) price resistance. You can see the initial support level is 1,230.
$SPX Daily: Possible three bar topping candlestick pattern. I would like to see more downside to confirm though.
IBM and AAPL: Here's where these big names can provide a clue. If they break down, IBM below the uptrend line and AAPL failing at gap resistance, then that would be supportive of the market heading lower. The opposite should hold true as well.
UUP: This might be the most interesting story of the day. Hard gap up on the dollar, possible island reversal putting pressure on the markets. Any continuation here could be unfriendly for Mr. Market.
My Watch List: I have 3 short candidates.
CMG: Could be an ascending wedge, but even if that is the case we should be due for a pull back. We do have divergences forming on both the RSI and MCD.
WFM: Possible ending diagonal with divergences forming. Below $69 with the MACD turning down would be interesting.
ROST: New price high on divergence. Price needs to fall and turn the MACD down. Below $82.50 (prior peak) would be interesting.
From My Trading Desk: On the weekend update I said we closed most of our longs on Friday, and I wanted to see how the market opened on Monday before possibly trading on the long side. The sell off was just too big so we did not. We did close our fractional long on EEM for a loss, but not a big deal.
Towards the end of the day I did place a couple of small shorts on CMG and ROST. I would consider the trades aggressive, so I kept the positions small!
If you've been reading my blog, then you know I've been extremely nimble in my trading. That's because of the evaluated volatility coupled with Mr. Market's back and forth in small and larger trading zones. I'm only comfortable with active trading in this market, and keeping my duration on trades short. I will probably continue to have that mind set regardless of being short or long.
Think of it this way, I'm taking what the market is giving at this point.
Happy Trading.
J.D. Rosendahl, Rosey