Twas the Pause Before Christmas...

When all through the market,
Not a stock fund was stirring, not even a bounce.
The stocks were all hung , by the resistance with care,
In hopes that a breakout soon would be there.

The traders were nestled all snug in their beds,
While visions of profits danced in their heads...

Stocks paused on Thursday, Christmas Eve eve, as the SPX closed at 1,256.77, down -2.07 or -0.16%.  Each of the broad indexes traded in a very narrow range on light volume and closed well above their 10 DMA.  All four broad indexes, the TRAN and SOX again closed above November’s old resistance now new support.  The market is closed on Friday, Christmas Eve.

(click image to enlarge)

SPX potential bearish harami

INDU new high close

COMPQ spinning top, fractional close below the low of the high day

RUT spinning top, fractional close below the low of the high day

Breadth weakened on Thursday as decliners led advancers 1.08 to 1 on the NYSE and 1.25 to 1 on the NASDAQ…

Exchange       NYSE          NASDAQ

Advancers      1,428              1,183

Decliners        1,544              1,482

(click image to enlarge)

Index Direction   Confirmation

VIX      Up               Yes – SPX

SOX    Down         Yes – COMPQ

Leading stocks on Thursday included CF, VECO, MOS, SKX, GME, AGU, GES, ESI, POT, CREE, FAZ, UCO, FCX, LDK, IPI, NTRI, LXK, TSL, SWN, BA, TIE, VMW, TBT

Losing stocks included UAL, BAC, HAS, ARUN, FAS, CMG, NDAQ, ATI, CAKE, NETL, GS, SNDK, JEC, CAM, X, RVBD, AMD, SPG, CRUS, FLS, PNC, CLF, CSTR, AKS, FWLT, HANS, HOLX, DECK, GR, ACN, URE, CHL, USD, STI, NYX, UNG, LVS

Interest rates rose on Thursday and bonds moved lower.  The Euro closed slightly higher at 1.3119. 

The SOX fell -1.31, closing at 411.78 on Thursday.  The VIX rose +1.02 and closed at 16.47.

Four of nine sectors moved higher on Thursday with Energy XLE +0.28% and Materials XLB +0.26% leading all sectors.

Moves on Thursday

Continuation – FCX, ZION, STI, WFC, BAC, XLF, CAT, DE, GOOG, SWK, WLT, JEC, X, AKS, NUE, STLD, IPI, A, DHR

Resistance Breakout – CF, GME, FAS, XLF, GR, FLS,

Bull Flag Bounce – WHR, NTRI, HSY, PNC, UNP, BYI, FFIV, VMW, C

MACD Divergence Bounce – LDK, TSL, JASO, LVS

Support Bounce – UNG, BIDU, NFLX

Bear Flag Break – CMG

Break of Support – SKX

Setup Charts to Watch

Bull Flag Setups – SINA, SNDK, CLF, ATI, NDAQ, F, WFMI, GES, WYNN, AMD, AKAM, ACN, TBT, CREE, NETL, USD, CRUS

Horizontal Breakout – GME, SLB, AGU, NTRI, ATW, GS, NYX, DOW

MACD Divergence – CSTR

Bear Flag Setups –

Horizontal Support Breakout – CAKE, HAS

Continue to trade with the trend of the chart you are trading.

SPX

Resistance: 1,256, 1,281

Support: 1, 241, 1,220, 1,209

Enter bullish trades with a bounce off support and a break above the high of the low day or a break out of horizontal resistance.  Thursday was an entry signal for many stocks.

Enter bearish trades on a break of short term support or a bounce down from the 30 DMA.

The short term 3 day trend is up.
The two-month trend is up.
The twelve-month trend is up.

Continue to focus on and trade setups on the charts of the stocks you watch.  Trade with the trend of the chart and follow your rules.

NDX 100 stocks stronger than the NDX include BBBY, TEVA, SPLS, VOD, MICC, INFY, DLTR, VMED, VRTX, WCRX, XLNX, CSCO, ADBE, DTV and YHOO.

Stocks weaker than the NDX: MU, ORLY, AKAM, MAT, NIHD, SNDK, AMZN, SYMC, LRCX, QCOM, EXPE, CTRP, ISRG and WYNN.

Stocks to Watch on Monday
Holding Above 30 DMA
SINA, CAM, WLT, ATW, SLB, NDAQ, USD, DECK, GR, RVBD, BYI, CAT, X, CREE, GES, HAS, CLF, INFA, VMW, SNDK, CRUS, FCX, FDX, AKS, A, AMD, DHR, DOW, FLS, GME, ICE, PNC, TBT, UCO, DE, FAS, JEC, STI, SWK, WHR, ZION, ACN, BAC, NYX, ESI, IPI, HSY, NTRI, ATI, CF, PCP, HANS, AIV, GS, URE, AGU, HLF, MOS, NFLX, POT, UNP, BA
Moving Above 30 DMA = 0

Moving Below 30 DMA = 3

CRM, MHS, NETL

Staying Below 30 DMA
CAKE, TIE, MA, SKX, V, CSTR, UNG, VECO, ARUN, CMG, RMBS, SOHU, GMCR, MCD, SPG, SWN, AMX, LVS, UAL, FAZ, TLT, NTES, LDK, CHL, TSL, LXK, DLR

Intermediate Term Market Trend: Up – 2 months
Short Term Market Trend: Up