6/27/11 Market Action

Today was a strong up day in the markets (SPY, IWM, QQQ), but it is still within the trading range that I outlined in my post from last week (see picture of SPY from earlier post). It is nice to see one strong day, but some more follow through on the upside would be nice. What I have seen over the last two weeks is an up day in the markets and then a gap down the next day. That does not make for a great swing trading environment. If I see a change of character in the market tomorrow and rather than gaping down, the market continues to move higher I would be more interested in trying some small positions in this market. In this type of market a strong defense is key.