IBM Leads SPX Down to Support...

DJIA 10,603.15 -122.15 -1.14% SP500 1,138.04 -12.19 -1.06% COMPQ 2,291.25 -29.15 -1.26% Russell 2000 639.61 - 9.54 -1.47% Exchange NYSE NASD Advancing 789 749 Declining 2,260 1,972 Oil $78.05 -1.27 – March contract Gold $1,113.00 -27.00 – February contract SOX 349.80 -1.04 VIX 18.68 +1.10 The VIX moved up and did confirm the move down in the SPX on Wednesday. The SOX moved down and did confirm the move down in the COMPQ. Strongest Sectors: XLF -0.26%…XLP -0.74%...XLV -0.85% Weakest Sectors: XLB -1.78%...XLK -1.61%...XLE -1.56% All nine sectors moved lower on Wednesday as selling reversed Tuesday’s buying with the SPX closing just two points above Friday’s close. Financials, Consumer Staples, Healthcare and Utilities were stronger than the SPX -1.06%. SPX Chart Signals Target: 1,234 end of January. This is not a subjective forecast; rather it is the chart target price and time based on the mid July breakout at 950. Continue to watch earnings reaction this week and next week. Sector Watch Up Trending: XLK, XLB, XLY, XLV, XLP, XLE, XLI, XLU Horizontal Breakout: XLF Sideways: Down Trending: Key Resistance Levels: 1,145 = 1,133 BO chart target – Dec 31 Low 1,155 = chart target Key Support Levels 1,025 - 1,133 = 1,075 BO chart target - Sep 08 Low 1,119 = December High 1,105 - 1,113 = November High 1,101 = October High 1,087 = Nov 10 Channel low 1,082 = Nov 9 S1 level 1,075 = 875 Breakout Chart Target All four broad indexes reversed Tuesday’s gains closing near Friday’s low above recent horizontal support. IBM fell on selling in reaction to earnings released after the close on even though they reported after better than expected earnings and raised its 2010 guidance. Apparently it wasn’t good enough to counter profit taking. CREE rose $9.38 or +17.30% on Wednesday after reporting better than expected earnings and raised fiscal Q3 guidance by 13 to 16 cents. STT, NTRS, BAC, USB and AMR rose while WFC, MS and COH fell after reporting earnings. In After-hours trading: EBAY climbed 1.80 or +8.10% after reported better than expected earnings and raising guidance. STX rose 1.84 or +10.36% reporting earnings of $1.03 vs. 65 cents estimate. SBUX rose 64 cents or +2.75% on better than expected earnings. Thursday Key Earnings to Watch: AMD, AXP, BNI, FCX, GOOG, ISRG, ESI, KEY, PNC, PCP, LUV, SYNA, UNP, UNH, WDC ZION rose another 81 cents or +4.73% in front of earnings on Jan 25. Guidance: The SPX has been in a narrow trading range between 1,130 and 1,150 since January 4 presumably waiting for earnings season. Earnings reaction is more important over earnings than the current technicals on the chart. Follow your strategies as a stock moves into its earnings release. Watch for support bounce or support break after Wednesday's pull back to support. Stay with your up trending positions. Continue to raise your stops. Stay with trends that have broken above resistance. Continue to focus on and trade setups on the charts of the stocks you watch and follow your rules. AAPL -3.31 QCOM -0.97 GOOG -7.21 BIDU -1.17 NDX 100 stocks stronger than the NDX include: LBTYA, NIHD, CEPH, IACI, LOGI, GENZ, TEVA, XLNX, ERTS, MXIM, INTC, PAYX, LRCX, ATVI, ADSK, JBHT, BIDU, EXPD, HANS, ALTR and NVDA. Stocks to Watch on Thursday Leading Stocks Holding Above 30 DMA MA, DLB, DE, ALGT, GR, SYNA, PCP, TDG, X, UAUA, WHR, URE, DHR, CBST, SNDK, AMED, CAM, GMCR, HANS, ESI, JEC, VAR, UYG, MOS, BUCY, ACN, DECK, DOW, FAS, WFC, ATW, BA, BAC, BYI, CAT, CEDC, CHL, FCX, HEAT, ZION, FLS, HLF, K, MHS, MCD, HDB, Moving Above 30 DMA = 2 GS, CREE Moving Below 30 DMA = 9 AGU, FUQI, ICE, IPI, SWN, UNP, USO, WLT, WMT Staying Below 30 DMA UNG, BKC, WAB, USD, PWRD, AMD, AMX, CGA, GES, MON, POT, TSL, BDX, MYGN, WCG, SPG, VPRT, GME, MELI, PCLN, FAZ, NFLX Intermediate Term Market Trend: Up Short Term Market Trend: Neutral