SPX Falls to Support...Break or Bounce to Follow?

DJIA - 187.13, -2.13% SP500 - 22.49, -2.38% NASDAQ Comp. - 42.42, -2.28% Russell 2000 - 15.00, -2.85% Exchange NYSE NASD Advancing 439 568 Declining 2,580 2,154 Oil $70.62 -$1.42 Gold $926.90 -$13.20 SOX 270.50 -4.29 VIX 30.81 +2.66 The VIX moved up and did confirm the move down in the SPX on Monday. Strongest Sectors: XLK -1.03%...XLY -2.01%...XLU -2.02% Weakest Sectors: XLB -4.12%...XLV -3.35%...XLI -3.05% All nine sectors moved lower on Monday. Technology, Consumer Discretionary and Utilities were stronger than the SPX -2.38%. Leading tech stocks stronger than XLK -1.03% include: TXN, MSFT, YHOO, MA, IBM, VZ, AAPL and GLW.

Sector Watch Up Trending: Horizontal Breakout: XLB, XLK, XLY, XLE Sideways: XLV, XLF, XLP, XLI, XLU Down Trending: SPX Key resistance levels: 944 – 956 = January/June horizontal 962 = 161.8% Fib extension Key support levels: 920 - 930 = horizontal 910 = 200 DMA 890 = 50 DMA 875 = horizontal

The SPX opened lower from overnight futures trading and fell to 920 before finding support and rising during the last hour of trading. The SPX closed at 923.72 in the area of May 20 and 29 resistance. Watch for either break of support or bounce on Tuesday.

The 13 week trend is up with the two week trend sideways and price sitting at support. About 80% of stocks moved lower. Many stocks in up trends showed signs of support buying late Monday.

Index Commentary The DJIA formed a bearish engulfing candle… three month chart target 10,340…volume was a below average 230 million shares …closed above its 20, 30, 50 and 200 DMA. The SPX formed a large black candle …3 month chart target of 1,075…closed above its 20, 30, 50 and 200 DMA. The Nasdaq formed a large black candle…3 month chart target of 2,065…closed above its 20, 30 50 and 200 DMA. The RUT formed a large black candle….3 month chart target 606…closed above its 20, 30, 50 and 200 DMA. At the Open on Monday SPY – large black candle USD – hammer FAS – large black candle URE – black spinning top WYNN – large black candle SHLD –hammer like candle DDS – spinning top AMZN – hammer NTAP – doji DECK – spinning top MICC – hammer like APOL – hammer GOOG – black spinning top FWLT – large black candle GR – large black candle GES – hammer

Stocks to Watch on Tuesday Leading Stocks Holding Above 30 DMA BIDU, CLB, ICE, VPRT, BAP, CAM, GMCR, ATW, GR, HDB, RIMM, HLF, AMX, K, PCLN, VAR, PCR, PPD, SWN, FLS, NIHD, JOYG, MUR, CHL, MOS, DV, AXYS, BYI, CPLA, SPWRA, SYNA, X, MCD, BDX, AAPL, GES, GXDX, ORCL, RBN, USD, WRC, DECK, CPLA, JEC, MYGN, PWR, AMZN, DV, JCOM, SNHY, STRA, BLUD, GILD, SLGN, JW.A, ACN, APEI Moving Above 30 DMA = 0 Moving Below 30 DMA = 15 BIIB, CBST, CTSH, EBAY, ESRX, FAS, MON, PCP, PSYS, RCI, SNA, TDG, TRLG, URE, UYG Staying Below 30 DMA DLTR, EZPW, WAB, FSLR, WCG, WMT, DLB, JOSB, AFAM, MHS, NTLS, ESI, HANS, AMED, PETS, ALGT, NFLX, GME, GPRO, BKC Intermediate Term Market Trend: Neutral Short Term Market Trend: Down